Exhibit 10.1
$450,000,000
REVOLVING CREDIT AGREEMENT
Dated as of January 29, 2003
among
STANDARD PACIFIC CORP.,
as Borrower,
THE LENDERS NAMED HEREIN,
as Lenders,
and
BANK OF AMERICA, N.A.,
as Administrative Agent,
BANK ONE, NA,
as Syndication Agent,
GUARANTY BANK,
as Documentation Agent,
WASHINGTON MUTUAL BANK, FA,
as Managing Agent,
BANC OF AMERICA SECURITIES LLC,
as Sole Lead Arranger and Sole Book Manager
TABLE OF CONTENTS
Page
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AGREEMENT .................................................................. 1
ARTICLE 1: DEFINITIONS AND ACCOUNTING TERMS ................................ 1
1.1 Defined Terms .................................................. 1
1.2 Number and Gender of Words; Other References ................... 18
1.3 Accounting Terms ............................................... 19
1.4 Exhibits ....................................................... 19
1.5 Time References ................................................ 19
ARTICLE 2: RECITALS ........................................................ 19
ARTICLE 3: BORROWING PROCEDURES, BORROWING BASE, LETTER OF CREDIT
SUBLIMIT, AND POSSIBLE INCREASE IN TOTAL AGGREGATE COMMITMENT ......... 20
3.1 Disbursement of Loan Proceeds .................................. 20
3.2 Reference Rate Borrowings ...................................... 22
3.3 Eurodollar Borrowing ........................................... 23
3.4 Redesignation of Borrowings .................................... 23
3.5 Calculation of Borrowing Base .................................. 25
3.6 Borrowing Base ................................................. 26
3.7 Payments by Lenders to Administrative Agent .................... 27
3.8 Sharing of Payments, Etc ....................................... 27
3.9 Letter of Credit Sublimit ...................................... 28
(a) Amount and Terms of the Credit ............................ 28
(b) Amounts and Terms of Standby Letters of Credit ............ 28
(c) Request for Credit ........................................ 28
(d) Issuance Fees ............................................. 28
(e) Conditions Precedent to Issuance of Letters of Credit ..... 29
(f) Subsidiary Letters of Credit .............................. 29
(g) Existing Letters of Credit ................................ 30
(h) Drawings and Reimbursements; Funding of Participations .... 30
(i) Repayment of Participations ............................... 31
(j) Obligations Absolute ...................................... 32
(k) Role of Issuing Bank ...................................... 33
(l) Indemnification by Lenders ................................ 33
(m) Applicability of ISP98 .................................... 34
(n) Conflict with L/C Application ............................. 34
(o) Letter of Credit Information .............................. 34
3.10 Possible Increase in Total Aggregate Commitment ................ 34
ARTICLE 4: PAYMENTS AND FEES; EXTENSION OPTION ............................. 35
4.1 Principal and Interest ......................................... 35
4.2 Unused Fee ..................................................... 37
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4.3 Commitment Fee ................................................. 37
4.4 Late Payments .................................................. 38
4.5 Taxes .......................................................... 38
4.6 Illegality ..................................................... 39
4.7 Increased Costs and Reduction of Return ........................ 40
4.8 Funding Losses ................................................. 40
4.9 Inability to Determine Rates ................................... 41
4.10 Reserves on Eurodollar Borrowings .............................. 41
4.11 Certificates of Lenders ........................................ 42
4.12 Substitution of Lenders ........................................ 42
4.13 Survival ....................................................... 42
4.14 Manner and Treatment of Payments ............................... 42
4.15 Mandatory Prepayment ........................................... 42
4.16 Other Fees ..................................................... 43
4.17 Maturity Date Extension Option ................................. 43
4.18 Voluntary Prepayment and Termination of Credit Facility Upon
Change of Control .............................................. 43
4.19 Optional Commitment Reduction and Termination .................. 43
ARTICLE 5: SECURITY ........................................................ 44
ARTICLE 6: CONDITIONS ...................................................... 44
6.1 Conditions to Disbursement of First Borrowings ................. 44
6.2 Conditions for Subsequent Borrowings ........................... 45
ARTICLE 7: REPRESENTATIONS AND WARRANTIES OF BORROWER ...................... 46
7.1 Incorporation, Qualification, Powers, and Capital Stock ........ 46
7.2 Execution, Delivery, and Performance of Loan Documents ......... 46
7.3 Compliance with Laws and Other Requirements .................... 47
7.4 Subsidiaries ................................................... 48
7.5 Financial Statements of Borrower and its Subsidiaries .......... 48
7.6 No Material Adverse Change ..................................... 49
7.7 Tax Liability .................................................. 49
7.8 Litigation ..................................................... 49
7.9 Pension Plan ................................................... 49
7.10 Regulations U and X; Investment Company Act .................... 49
7.11 No Default ..................................................... 49
7.12 Environmental Compliance ....................................... 50
7.13 Solvent ........................................................ 50
7.14 Senior Debt .................................................... 50
ARTICLE 8: COVENANTS OF BORROWER ........................................... 50
8.1 Reporting Requirements ......................................... 50
8.2 Payment of Taxes and Other Potential Liens ..................... 52
8.3 Preservation of Existence ...................................... 52
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8.4 Maintenance of Properties ...................................... 52
8.5 Maintenance of Insurance ....................................... 52
8.6 Books and Records .............................................. 52
8.7 Inspection Rights .............................................. 53
8.8 Compliance with Laws and Other Requirements .................... 53
8.9 Subsidiary Guaranties .......................................... 53
8.10 Mergers ........................................................ 53
8.11 Liens .......................................................... 54
8.12 Prepayment of Indebtedness ..................................... 55
8.13 Change in Nature of Business ................................... 55
8.14 Pension Plan ................................................... 55
8.15 Dividends and Subordinated Debt ................................ 55
8.16 Disposition of Properties ...................................... 56
8.17 Limitation on Investments ...................................... 57
8.18 Senior Unsecured Home Building Debt Not to Exceed Borrowing
Base ........................................................... 58
8.19 Consolidated Tangible Net Worth ................................ 58
8.20 Leverage Covenants ............................................. 59
8.21 Minimum Interest Coverage ...................................... 59
8.22 Transactions with Affiliates ................................... 60
ARTICLE 9: EVENTS OF DEFAULT AND REMEDIES UPON DEFAULT ..................... 60
9.1 Events of Default .............................................. 60
9.2 Remedies ....................................................... 62
9.3 Rights Not Exclusive ........................................... 63
ARTICLE 10: ADMINISTRATIVE AGENT ........................................... 64
10.1 Appointment and Authorization .................................. 64
10.2 Delegation of Duties ........................................... 64
10.3 Liability of Administrative Agent .............................. 64
10.4 Reliance by Administrative Agent ............................... 65
10.5 Notice of Default .............................................. 65
10.6 Credit Decision ................................................ 65
10.7 Indemnification ................................................ 66
10.8 Administrative Agent in Individual Capacity .................... 66
10.9 Successor Administrative Agent ................................. 66
10.10 Tax Forms ...................................................... 67
10.11 Defaulting Lenders ............................................. 69
10.12 Actions ........................................................ 69
10.13 Syndication Agent, Documentation Agent and Co-Agent ............ 70
10.14 Approval of Lenders ............................................ 70
ARTICLE 11: MISCELLANEOUS .................................................. 70
11.1 Amendments and Waivers ......................................... 70
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11.2 Costs, Expenses, and Taxes ..................................... 71
11.3 No Waiver; Cumulative Remedies ................................. 72
11.4 Payments Set Aside ............................................. 72
11.5 Successors and Assigns ......................................... 72
11.6 Assignments, Participations, etc ............................... 72
11.7 Set-off ........................................................ 75
11.8 Automatic Debits ............................................... 75
11.9 Notification of Addresses, Lending Offices, Etc ................ 75
11.10 Survival of Representations and Warranties ..................... 75
11.11 Notices ........................................................ 76
11.12 Indemnity by Borrower .......................................... 76
11.13 Integration and Severability ................................... 77
11.14 Counterparts ................................................... 77
11.15 No Third Parties Benefitted .................................... 77
11.16 Section Headings ............................................... 77
11.17 Time of the Essence ............................................ 77
11.18 Governing Law .................................................. 77
11.19 Jury Trial ..................................................... 77
11.20 Entirety ....................................................... 78
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LIST OF EXHIBITS
Exhibit A - Form of Assignment and Assumption Agreement
Exhibit B - Borrowing Base Certificate
Exhibit C - Continuing Guaranty (several subsidiaries)
Exhibit D - Continuing Guaranty (Standard Pacific Corp.)
Exhibit E - Note
Exhibit F - Form of Legal Opinion
Exhibit G - Request for Borrowing
Exhibit H - Request for Letter of Credit
Exhibit I - Request for Redesignation of Borrowing
Exhibit J - Subsidiaries and Homebuilding Joint Ventures
LIST OF SCHEDULES
Schedule 1.1 - Lender Commitment Schedule
Schedule 3.9 - Existing Letters of Credit
Schedule 4.2 - Example of Unused Fee Calculation
Schedule 8.9 - Material Subsidiaries
Schedule 8.21 - Interest Coverage Ratio Calculation
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REVOLVING CREDIT AGREEMENT
This Revolving Credit Agreement ("Agreement") is dated as of January 29,
2003, by and among STANDARD PACIFIC CORP., a Delaware corporation ("Borrower"),
the several financial institutions from time to time party to this Agreement
(collectively, "Lenders" and individually, a "Lender"), and BANK OF AMERICA,
N.A., a national banking association ("Bank of America"), as administrative
agent for Lenders (in such capacity, "Administrative Agent"), and is made with
reference to the facts set forth below.
Borrower has requested that Lenders provide to Borrower a revolving credit
facility, and Lenders are willing to do so on the terms and conditions set forth
herein.
AGREEMENT
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, it is hereby agreed by and among
the parties hereto as follows:
ARTICLE 1: DEFINITIONS AND ACCOUNTING TERMS.
1.1 Defined Terms. As used in this Agreement, the following terms
shall have the meanings set forth respectively after each:
"Account" means Borrower's general account maintained with Bank of
America, and any future similar account with Administrative Agent.
"Acquisition" means any transaction or series of related transactions
for the purpose of, or resulting in, directly or indirectly, (a) the
acquisition by Borrower or any of its Subsidiaries of all or substantially all
of the assets of a Person or of any line of business or division of a Person,
(b) the acquisition by Borrower or any of its Subsidiaries of more than fifty
percent (50%) of any class of stock (or similar ownership interests) of any
Person; or (c) a merger, consolidation, amalgamation, or other combination by
Borrower or any of its Subsidiaries with another Person (other than Borrower
or any of its Subsidiaries) if Borrower or any of its Subsidiaries is the
surviving entity. Notwithstanding the foregoing, the acquisition by Borrower
or any of its Subsidiaries in the ordinary course of business of real property
(or of a Person, substantially all of whose assets are, real property and that
does not have substantial homebuilding operations) shall not be considered an
Acquisition.
"Adjusted Consolidated Tangible Net Worth" means, as of any date, (a)
Consolidated Tangible Net Worth, minus (b) the amount of Borrower's and its
Subsidiaries' Investments in Standard Pacific Financing, Inc., FLS, Standard
Pacific Financing, L.P., and their respective Subsidiaries determined in
accordance with GAAP.
"Administrative Agent" means Bank of America when acting in its capacity
as Administrative Agent under any of the Loan Documents and any successor
administrative agent.
"Affiliate" of a Person means any Person (a) which directly, or
indirectly through one or more intermediaries, controls, or is controlled by,
or is under common control with such Person, or (b) which directly, or
indirectly through one or more intermediaries, owns beneficially or of record
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twenty percent (20%) or more of the Voting Stock of such Person. The term
"control" means the possession, directly or indirectly, of the power to cause
the direction of the management and policies of a Person, whether through the
ownership of voting securities or partnership interests, by contract, family
relationship, or otherwise.
"Agent-Related Persons" means Administrative Agent and any successor
agent (pursuant to the terms of Section 10.9) together with their respective
Affiliates (including, in the case of Bank of America in its capacity as
Administrative Agent, Arranger) and the directors, officers, agents,
employees, and attorneys-in-fact of such Persons and Affiliates.
"Agreement" means this Revolving Credit Agreement, either as originally
executed or as it may from time to time be supplemented, modified, or amended.
"Applicable Margin" means, as of any date of determination, a percentage
per annum determined by the Pricing Level in effect on such date as shown
below:
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Eurodollar Reference Rate Commitment Fee
Pricing Level Borrowings Borrowings
------------------------------------------------------------------------------------------------------------
Level I (Total Leverage Ratio ** 1.0 to 1.0) 1.250% 0.00% 0.10%
------------------------------------------------------------------------------------------------------------
Level II (Total Leverage Ratio *** 1.0 to 1.0
but * 1.25 to 1.0) 1.425% 0.00% 0.10%
------------------------------------------------------------------------------------------------------------
Level III (Total Leverage Ratio *** 1.25 to 1.0
but * 1.50 to 1.0) 1.625% 0.00% 0.10%
------------------------------------------------------------------------------------------------------------
Level IV (Total Leverage Ratio *** 1.50 to 1.0
but * 1.75 to 1.0) 1.80% 0.00% 0.10%
------------------------------------------------------------------------------------------------------------
Level V (Total Leverage Ratio *** 1.75 to 1.0
but * 2.0 to 1.0) 2.0% 0.00% 0.125%
------------------------------------------------------------------------------------------------------------
Level VI (Total Leverage Ratio *** 2.0 to 1.0) 2.25% 0.00% 0.15%
------------------------------------------------------------------------------------------------------------
* means less than
** means less than or equal to
*** means greater than or equal to
Any increase or decrease in the Applicable Margin resulting from a change in
the Total Leverage Ratio shall become effective as of the first (1/st/)
Business Day immediately following the date a compliance certificate is
delivered pursuant to Section 8.1(e); provided, however, that if a compliance
certificate is not delivered when due in accordance with Section 8.1(e), then
Pricing Level VI shall apply as of the first (1/st/) Business Day after the
date on which such compliance certificate was required to have been delivered
and shall continue to apply until the first (1/st/) Business Day after the
date such compliance certificate is delivered. The Applicable Margin in effect
from the Closing Date until the next adjustment date shall be determined based
upon Pricing Level II. In order for Pricing Level I to be in effect at any
time, Borrower's Debt Rating must be at least BBB- or Baa3, as applicable, as
published by at least two (2) of ▇▇▇▇▇'▇, S&P, and Fitch (and at any time when
Pricing Level I is not so available for such reason, Pricing Level II shall be
in effect).
"Arranger" means Banc of America Securities LLC, in its capacity as sole
lead arranger and sole book manager.
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"Assignment and Assumption" means an Assignment and Assumption
substantially in the form of Exhibit A.
"Attorney Costs" means and includes all reasonable fees and
disbursements of any law firm or other external counsel, the allocated cost of
internal legal services, and all disbursements of internal legal counsel.
"Bank of America" has the meaning set forth in the introductory
paragraph hereto.
"Borrower" has the meaning set forth in the introductory paragraph
hereto.
"Borrowing" means each of the Loans to be made by Lenders to Borrower as
provided in Article 3.
"Borrowing Base" has the meaning set forth in Section 3.5(b).
"Borrowing Base Certificate" means a written calculation of the
Borrowing Base, substantially in the form of Exhibit B, signed by a
Responsible Official of Borrower, and properly completed to provide all
information required to be included thereon.
"Business Day" means any day other than a Saturday, Sunday, or other day
on which commercial banks are authorized to close under the Laws of, or are in
fact closed in, the state where Administrative Agent's Lending Office is
located and, if such day relates to any Eurodollar Borrowing, means any such
day on which dealings in Dollar deposits are conducted by and between banks in
the London interbank eurodollar market.
"Capital Adequacy Regulation" means any guideline, request, or directive
of any central bank or other Governmental Authority, or any other Law, whether
or not having the force of law, in each case, regarding capital adequacy of
any bank or other financial institution or of any corporation controlling a
bank or other financial institution.
"Capitalized Lease Obligations" means any obligations under a lease that
is required to be capitalized for financial reporting purposes in accordance
with GAAP.
"Cash Account" has the meaning set forth in Section 9.2.
"Change of Control" means the occurrence of any of the following: (a)
any Person becomes the beneficial owner, directly or indirectly, of more than
fifty percent (50%) of the total voting power of the Voting Stock of Borrower;
or (b) during any period of two (2) consecutive years, individuals who at the
beginning of such period constituted the board of directors of Borrower
(together with any new directors whose election by such board of directors, or
whose nomination for election by the shareholders of Borrower, was approved by
a majority vote of the directors of Borrower then still in office who are
either directors at the beginning of such period or whose election or
nomination for election was previously so approved) cease for any reason to
constitute the majority of the board of directors of Borrower then in office;
or (c) for any reason a "change in control" or similar event shall
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occur as provided in any agreement governing any Subordinated Debt or any
indebtedness of Borrower or its Subsidiaries issued pursuant to the terms of
an indenture.
"Closing Date" means January 29, 2003.
"Code" means the Internal Revenue Code of 1986.
"Combined Senior Home Building Debt" means, as of any date, Combined
Total Home Building Debt less Subordinated Debt.
"Combined Total Home Building Debt" means, as of any date, (a) all
funded debt of Borrower and its Subsidiaries determined on a consolidated
basis (excluding funded debt of Excluded Subsidiaries), plus (b) all funded
debt with recourse to any partnership in which Borrower or a Subsidiary (other
than an Excluded Subsidiary) is a general partner, plus (c) all reimbursement
obligations with respect to drawn Financial Letters of Credit and the face
amount of all undrawn Financial Letters of Credit, in each case issued for the
account of, or guaranteed by, Borrower or any of its Subsidiaries (other than
an Excluded Subsidiary), plus (d) all guaranties or other funding obligations
of Borrower or a Subsidiary (other than an Excluded Subsidiary) of funded debt
of third parties (including Excluded Subsidiaries), provided, however, that in
the case of any loan to value maintenance agreements (or similar agreements)
by which Borrower or a Subsidiary agrees to maintain for a joint venture a
minimum ratio of indebtedness outstanding to value of collateral property,
only amounts owing by Borrower or a Subsidiary at the time of determination
will be included in the calculation of Combined Total Home Building Debt, plus
(e) all Rate Hedging Obligations of Borrower and its Subsidiaries (other than
an Excluded Subsidiary).
"Commitment" means, with respect to the Loans of each Lender, the Dollar
amount and percentage obligation set forth on Schedule 1.1 or in the
Assignment and Assumption pursuant to which such Lender became a party hereto,
in each case as such Dollar amounts may increase or decrease as provided in
this Agreement including changes as a result of assignments made in accordance
with Section 11.6 and increases in the Total Aggregate Commitment in
accordance with Section 3.10.
"Completed Unit" means a Unit as to which either (or both) of the
following has occurred: (a) a notice of completion has been filed or recorded
in the appropriate real estate records; or (b) all necessary construction has
been completed in order to obtain a certificate of occupancy (whether or not
such certificate of occupancy has actually been obtained).
"Consolidated Home Building Interest Expense" means, for any period,
without duplication, the aggregate amount of interest which, in conformity
with GAAP, would be opposite the caption "interest expense" or any like
caption on an income statement for Borrower and its Subsidiaries (excluding
the Excluded Subsidiaries), whether expensed directly, or included as a
component of cost of goods sold, or allocated to joint ventures, or otherwise
(including, without limitation, imputed interest included on Capitalized Lease
Obligations and zero coupon bonds, all commissions, discounts, and other fees
and charges owed with respect to letters of credit and bankers' acceptance
financing, the net costs associated with Rate Hedging Obligations,
amortization of other financing fees and expenses, the interest portion of any
deferred payment obligation, amortization of discount or premium, if any,
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and all non-cash interest expense), excluding interest expense related to
mortgage banking operations or any other financial services related
Subsidiary, plus the product of (i) cash dividends paid on any preferred stock
of Borrower, times (ii) a fraction, the numerator of which is one (1) and the
denominator of which is one (1) minus the then current effective aggregate
federal, state, and local tax rate of Borrower, expressed as a decimal.
"Consolidated Home Building Interest Incurred" means, for any period,
without duplication, the aggregate amount of interest which, in conformity
with GAAP, would be opposite the caption "interest expense" or any like
caption on an income statement for Borrower and its Subsidiaries (excluding
the Excluded Subsidiaries) or allocated to joint ventures, or otherwise
(including, without limitation, imputed interest included on Capitalized Lease
Obligations and zero coupon bonds, all commissions, discounts, and other fees
and charges owed with respect to letters of credit and bankers' acceptance
financing, the net costs associated with Rate Hedging Obligations,
amortization of other financing fees and expenses, the interest portion of any
deferred payment obligation, amortization of discount or premium, if any, and
all non-cash interest expense) and, without duplication, all capitalized
interest for such period and all interest attributable to discontinued
operations for such period (excluding the Excluded Subsidiaries) to the extent
not set forth on the income statement under the caption "interest expense" or
any like caption, excluding interest expense related to mortgage banking
operations or any other financial services related Subsidiary and excluding
interest as a component of cost of goods sold, plus the product of (i) cash
dividends paid on any preferred stock of Borrower, times (ii) a fraction, the
numerator of which is one (1) and the denominator of which is one (1) minus
the then current effective aggregate federal, state, and local tax rate of
Borrower, expressed as a decimal.
"Consolidated Home Building Net Income" means, for any period, the net
income (or loss) of Borrower and its Subsidiaries (excluding the Excluded
Subsidiaries), determined in accordance with GAAP and excluding the share
thereof attributable to holders of ownership interests of any Subsidiary
(other than Borrower or a Subsidiary of Borrower).
"Consolidated Tangible Net Worth" means, as of any date, the sum of the
following with respect to Borrower and its Subsidiaries determined and
consolidated in conformity with GAAP:
(a) the amount of stated capital (excluding the cost of treasury
shares), additional paid-in capital, and retained earnings (or, in the case of
a deficit in additional paid-in capital or retained earnings, minus the amount
of the deficit); minus
(b) the carrying value of intangible assets, such as deferred costs
associated with goodwill, patents, franchises, organizational expenses, and
the like (but excluding receivables, pre-paid expenses, the capitalized value
of leases, and all costs that are specifically identifiable or are
identifiable on a rational and consistent basis with the unexpired service
value of tangible assets); and minus
(c) any amounts which would otherwise be included in the calculation of
Consolidated Tangible Net Worth under subparagraph (a) immediately above of
this definition which pertain to or are attributable to Borrower's or any
Subsidiary's equity interest in any Home Building Joint Venture which is in
default with respect to the payment of any monetary obligations owing under
any land
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loan, acquisition and development loan, construction loan, secured or
unsecured credit facility, or any other loan or other indebtedness for
borrowed money.
"Contribution Agreement" means the Contribution and Indemnity Agreement
executed and delivered by each Guarantor in form and substance acceptable to
Administrative Agent.
"Debtor Relief Laws" means the Bankruptcy Code of the United States, and
all other liquidation, conservatorship, bankruptcy, assignment for the benefit
of creditors, moratorium, rearrangement, receivership, insolvency,
reorganization, or similar debtor relief Laws of the United States or other
applicable jurisdictions from time to time in effect and affecting the rights
of creditors generally.
"Debt Rating" means, as of any date of determination, the rating as
determined by either S&P, Moody's, or Fitch of Borrower's non-credit-enhanced
(other than guaranties by Subsidiaries), senior unsecured long-term debt.
"Default" means any event or circumstance that, with the giving of
notice or passage of time, or both, would become an Event of Default.
"Defaulting Lender" has the meaning set forth in Section 10.11.
"Documentation Agent" means the Lender which is designated in writing by
Administrative Agent to serve as Documentation Agent hereunder (subject to
Section 10.13).
"Dollars" or "$" means United States dollars.
"Eligible Assignee" means (a) a Lender; (b) an Affiliate of a Lender
that is regularly engaged in the business of making commercial loans of the
type evidenced by this Agreement; and (c) an Eligible Institution approved by
(i) Administrative Agent and each Issuing Bank, and (ii) unless an Event of
Default has occurred and is continuing, Borrower (each such approval not to be
unreasonably withheld or delayed); and (d) any other Person (other than a
natural person) approved by (i) Administrative Agent and each Issuing Bank,
and (ii) unless an Event of Default has occurred and is continuing, Borrower
(each such approval to be in their sole discretion); provided that
notwithstanding the foregoing, "Eligible Assignee" shall not include Borrower
or Borrower's Affiliates.
"Eligible Institution" means a commercial bank or other financial
institution that has (or, in the case of a bank or financial institution that
is a subsidiary, such bank's or financial institution's parent has) (a) a
rating of its senior debt obligations of not less than Baa1 by Moody's or BBB+
by S&P, and (b) total assets in excess of $10,000,000,000.
"Eligible Subsidiary" means a Subsidiary of Borrower in which (a)
Borrower directly or indirectly owns at least ninety percent (90%) of the
issued and outstanding ownership interests and (b) a majority of the holders
of such ownership interests has the ability to cause such Subsidiary to incur
indebtedness, grant liens, and sell or transfer assets.
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"Entitled Land" means (a) as to land not located in California owned by
Borrower or any Eligible Subsidiary that is a Guarantor, land where all
requisite zoning requirements and land use requirements have been satisfied,
and all requisite approvals have been obtained from all applicable
Governmental Authorities (other than approvals which are simply ministerial
and non-discretionary in nature or otherwise not material), in order to
develop the land as a residential housing project and construct Units thereon,
and (b) as to land located in California owned by Borrower or any Eligible
Subsidiary that is a Guarantor, land which satisfies the requirements of
subparagraph (a) immediately above, and which is subject to a currently
effective vesting tentative map (unless a county or city where the land is
located does not grant vesting tentative maps) which has received all
necessary approvals by all applicable Governmental Authorities (other than
approvals which are simply ministerial and non-discretionary in nature or
otherwise not material).
"Environmental Laws" means any and all federal, state, local, and
foreign Laws, judgments, orders, decrees, permits, concessions, grants,
franchises, licenses, agreements, or governmental restrictions relating to
pollution and the protection of the environment or the release of any
materials into the environment, including those related to hazardous
substances or wastes, air emissions, and discharges to waste or public
systems.
"ERISA" means the Employee Retirement Income Security Act of 1974.
"ERISA Affiliate" means any trade or business (whether or not
incorporated) under common control with Borrower within the meaning of Section
414(b) or (c) of the Code (and Sections 414(m) and (o) of the Code for
purposes of provisions relating to Section 412 of the Code).
"ERISA Event" means: (a) a Reportable Event with respect to a Plan; (b)
a withdrawal by Borrower or any ERISA Affiliate from a Pension Plan subject to
Section 4063 of ERISA during a plan year in which it was a substantial
employer (as defined in Section 4001(a)(2) of ERISA) or a cessation of
operations that is treated as such a withdrawal under Section 4062(e) of
ERISA; (c) a complete or partial withdrawal by Borrower or any ERISA Affiliate
from a Multiemployer Plan or notification that a Multiemployer Plan is in
reorganization; (d) the filing of a notice of intent to terminate, the
treatment of a Plan amendment as a termination under Sections 4041 or 4041A of
ERISA, or the commencement of proceedings by the PBGC to terminate a Plan; (e)
an event or condition which constitutes grounds under Section 4042 of ERISA
for the termination of, or the appointment of a trustee to administer, any
Plan; or (f) the imposition of any liability under Title IV of ERISA, other
than for PBGC premiums due but not delinquent under Section 4007 of ERISA,
upon Borrower or any ERISA Affiliate.
"Escrow Proceeds Receivable" means funds due to Borrower or any Eligible
Subsidiary that is a Guarantor held at an escrow company following the sale
and conveyance of title of a Unit to a buyer.
"Eurodollar Borrowing" means any Loan or portion thereof designated or
redesignated by Borrower as a Eurodollar Borrowing pursuant to Article 3.
"Eurodollar Lending Office" means the office or branch of each Lender so
designated on the signature pages of this Agreement, or such other office or
branch of each Lender as it may hereafter designate, by written notice to
Borrower and Administrative Agent, as its Eurodollar Lending Office.
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"Eurodollar Rate" means for any Interest Period with respect to any
Eurodollar Borrowing:
(a) the rate per annum equal to the rate determined by Administrative
Agent to be the offered rate that appears on the page of the Telerate screen
(or any successor thereto) that displays an average British Bankers
Association Interest Settlement Rate for deposits in Dollars (for delivery on
the first (1/st/) day of such Interest Period) with a term equivalent to such
Interest Period, determined as of approximately 11:00 a.m. (London time) two
(2) Business Days prior to the first (1/st/) day of such Interest Period; or
(b) if the rate referenced in the preceding clause (a) does not appear
on such page or service or such page or service shall not be available, then
the rate per annum equal to the rate determined by Administrative Agent to be
the offered rate on such other page or other service that displays an average
British Bankers Association Interest Settlement Rate for deposits in Dollars
(for delivery on the first (/1st/) day of such Interest Period) with a term
equivalent to such Interest Period, determined as of approximately 11:00 a.m.
(London time) two (2) Business Days prior to the first (1/st/) day of such
Interest Period; or
(c) if the rates referenced in the preceding clauses (a) and (b) are
not available, then the rate per annum determined by Administrative Agent as
the rate of interest at which deposits in Dollars for delivery on the first
(1/st/) day of such Interest Period in same day funds in the approximate
amount of the Eurodollar Borrowing being made, continued, or converted by
Administrative Agent and with a term equivalent to such Interest Period would
be offered by Administrative Agent's London branch to major banks in the
London interbank eurodollar market at their request at approximately 4:00 p.m.
(London time) two (2) Business Days prior to the first (1/st/) day of such
Interest Period.
"Event of Default" has the meaning set forth in Section 9.1.
"Excluded Subsidiaries" means, collectively, Standard Pacific Financing,
Inc., FLS (including any Subsidiaries thereof), Standard Pacific Financing,
L.P., and any Home Building Joint Venture that Borrower designates as an
"Excluded Subsidiary" by written notice to Administrative Agent.
"Existing Agreement" means that certain Ninth Amended and Restated
Revolving Credit Agreement dated as of September 26, 2000, executed by
Borrower, Bank of America, N.A., as Agent, and Banks defined therein, as
modified, amended, renewed, extended, and supplemented from time to time.
"Existing Letters of Credit" means the Letters of Credit listed on
Schedule 3.9 and issued pursuant to the Existing Agreement.
"Federal Funds Rate" means, for any day, the rate per annum equal to the
weighted average of the rates on overnight Federal funds transactions with
members of the Federal Reserve System arranged by Federal funds brokers on
such day, as published by the Federal Reserve Bank of New York on the Business
Day next succeeding such day; provided that (a) if such day is not a Business
Day, then the Federal Funds Rate for such day shall be such rate on such
transactions on the next
-8-
preceding Business Day as so published on the next succeeding Business Day,
and (b) if no such rate is so published on such next succeeding Business Day,
then the Federal Funds Rate for such day shall be the average rate (rounded
upward, if necessary, to a whole multiple of 1/100 of 1%) charged to
Administrative Agent on such day on such transactions as determined by
Administrative Agent.
"Fee Letter" means the letter agreement, dated November 5, 2002, among
Borrower, Administrative Agent, and Arranger.
"Financial Letter of Credit" means any letter of credit covering the
potential default of a financial contractual obligation and includes: (a) all
letters of credit securing notes, debentures, commercial paper, securities,
loans, or other debt obligations; (b) all letters of credit securing
insurance, re-insurance, or self-insurance; (c) all letters of credit securing
leases, if to guaranty payment of rent, return of security deposits, or other
payment obligations; and (d) in lieu of advance payments when made on a
contractual obligation which is essentially financial in nature (i.e.,
workers' compensation).
"Finished Lots" means lots of Entitled Land as to which land development
construction has been substantially completed, utilities, and all major
infrastructure have been stubbed to the site, and building permits may be
promptly pulled by Borrower or any Affiliate without the satisfaction of any
further material conditions.
"Fitch" means Fitch IBCA, Duff & ▇▇▇▇▇▇, a division of Fitch, Inc. and
any successor thereto.
"FLS" means Family Lending Services, Inc., a Delaware corporation.
"Foreign Lender" has the meaning set forth in Section 10.10(a).
"FRB" means the Board of Governors of the Federal Reserve System, and
any Governmental Authority succeeding to any of its principal functions.
"GAAP" means generally accepted accounting principles in the United
States set forth in the opinions and pronouncements of the Accounting
Principles Board and the American Institute of Certified Public Accountants
and statements and pronouncements of the Financial Accounting Standards Board
or such other principles as may be approved by a significant segment of the
accounting profession in the United States, that are applicable to the
circumstances as of the date of determination.
"GAAP Value" means, with respect to each property constituting part of
Borrower's and its Eligible Subsidiaries' Real Estate Inventory, the asset
value for such property or asset determined in accordance with GAAP.
"Governmental Authority" means any nation or government, any state or
other political subdivision thereof, any central bank (or similar monetary or
regulatory authority) thereof, any entity exercising executive, legislative,
judicial, regulatory, or administrative functions of or pertaining to
government, and any corporation or other entity owned or controlled, through
stock or capital ownership or otherwise, by any of the foregoing.
-9-
"Guarantors" means all existing and future Material Subsidiaries and
each other Subsidiary required to execute a Guaranty pursuant to Section 8.9,
and "Guarantor" means any one of the Guarantors.
"Guaranty" means a continuing guaranty, substantially in the form of
Exhibit C, to be executed and delivered by a Guarantor to Administrative Agent
for the benefit of Lenders.
"Guaranty of the Subsidiary Letters of Credit" means a guaranty of
Borrower guaranteeing all indebtedness and obligations arising under or
relating to the Subsidiary Letters of Credit, substantially in the form of
Exhibit D.
"Home Building EBITDA" means, for Borrower and its Subsidiaries (other
than Excluded Subsidiaries) on a consolidated basis and for any period,
without duplication: (a) the sum of the following amounts attributable to such
period: (i) Consolidated Home Building Net Income; (ii) Consolidated Home
Building Interest Expense; (iii) charges against income for all federal,
state, and local taxes; (iv) depreciation expense; (v) amortization expense;
(vi) write-off of goodwill, impairment charges, and other non-cash charges and
expenses (including non-cash charges resulting from accounting changes); (vii)
cash distributions of income earned by Excluded Subsidiaries actually received
during such period; and (viii) any losses arising outside of the ordinary
course of business which have been included in the determination of
Consolidated Home Building Net Income; less (b) any gains or other non-cash
items arising outside the ordinary course of business which have been included
in the determination of Consolidated Home Building Net Income, all as
determined on a consolidated basis for Borrower and Subsidiaries (excluding
the Excluded Subsidiaries).
"Home Building Joint Venture" means any Person that was formed for and
is engaged in homebuilding operations in which Borrower or any of its
Subsidiaries has less than an eighty percent (80%) ownership interest.
"Honor Date" has the meaning set forth in Section 3.9(h)(i).
"Increasing Lender" has the meaning set forth in Section 3.10(b).
"Interest Coverage Failure Period" has the meaning set forth in Section
8.21(a).
"Interest Coverage Notice" has the meaning set forth in Section 8.21(a).
"Interest Coverage Ratio" has the meaning set forth in Section 8.21.
"Interest Payment Date" means the third (3rd) Business Day of each month
and the Maturity Date.
"Interest Period" means, as to each Eurodollar Borrowing, the period
commencing on the date specified in the applicable Request for Borrowing or
Request for Redesignation of Borrowing by Borrower pursuant to Sections 3.3 or
3.4 and ending seven (7) days, one (1) month, two (2) months, three (3) months
or six (6) months thereafter or, to the extent available from all Lenders,
nine (9)
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months or twelve (12) months thereafter, as designated by Borrower in the
applicable Request for Borrowing or Request for Redesignation of Borrowing,
provided that:
(a) the first (1/st/) day in any Interest Period shall be a Business
Day;
(b) any Interest Period that would otherwise end on a day that is not a
Business Day shall be extended to the next succeeding Business Day
unless such Business Day falls in another calendar month, in which
case such Interest Period shall end on the next preceding Business
Day; and
(c) no Interest Period shall extend beyond the Maturity Date.
"Investment" means any net investment by Borrower or any Subsidiary in
any joint venture, partnership, corporation, limited liability company or
other entity, whether by acquisition of stock, assets, or debt, or by loan (or
other extension of credit), advance, transfer of property out of the ordinary
course of business, capital contribution, payment pursuant to a guaranty or
any other contingent liability of Borrower in respect of liabilities of such
entity, or otherwise. For purposes hereof, the net amount of any Investment
shall be calculated as (a) the initial amount of such Investment, plus (b) any
additional capital contributions or other similar amounts with respect to such
Investment, less (c) all returns of capital with respect to such Investment.
"Issuing Banks" means Bank of America in its individual capacity as a
bank issuing Letters of Credit under this Agreement and such other Lenders
which agree, at the request of Borrower and with the consent of Administrative
Agent (such consent not to be unreasonably withheld), to issue one or more
Letters of Credit pursuant to the terms and conditions of this Agreement;
provided that there may not be more than four (4) Issuing Banks (including
Bank of America) at any time, and "Issuing Bank" means any one of the Issuing
Banks.
"Judgment Liens" means any judgment liens, attachment liens, or any
other liens which secure a judgment or any other obligations imposed by court
order or other directive of a court.
"Laws" means, collectively, all international, foreign, federal, state,
and local statutes, treaties, rules, regulations, ordinances, codes, and
administrative or judicial precedents.
"L/C Advance" means, with respect to each Lender, such Lender's funding
of its participation in any L/C Borrowing in accordance with its Pro Rata
Share.
"L/C Application" has the meaning set forth in Section 3.9(c).
"L/C Borrowing" means an extension of credit resulting from a drawing
under any Letter of Credit which has not been reimbursed on the date when made
or refinanced as a Reference Rate Borrowing.
"L/C Commitment" has the meaning set forth in Section 3.9(a).
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"L/C Commitment Termination Date" means the day that is thirty (30) days
prior to the then-current Maturity Date (or if such day is not a Business Day,
then the next preceding Business Day).
"L/C Obligations" has the meaning set forth in Section 3.9(a).
"L/C Obligations Amount" has the meaning set forth in Section 9.2.
"Lenders" has the meaning specified in the introductory paragraph.
"Lending Office" means (a) as to Administrative Agent, the office or
offices of Administrative Agent set forth on its signature page to this
Agreement, or such other address or account as Administrative Agent may from
time to time notify Borrower and Lenders, and (b) as to each Lender, the
office or offices of such Lender set forth on its signature page to this
Agreement, or such other office or offices as such Lender may from time to
time notify Borrower and Administrative Agent.
"Letters of Credit" has the meaning set forth in Section 3.9(b)(i).
"Letter of Credit Subsidiaries" has the meaning set forth in Section
3.9(f).
"Loan" or "Loans" means each of the loans and Borrowings under this
Agreement.
"Loan Documents" means, collectively, this Agreement, each Note, the
Guaranty, the Guaranty of the Subsidiary Letters of Credit, the Contribution
Agreement, the Fee Letter, each L/C Application, and each Letter of Credit.
"Lots Under Development" means (a) Entitled Land where physical site
improvement has commenced and is continuing, and (b) Finished Lots.
"Majority Lenders" means, at any time, Lenders holding in excess of
sixty-six and two-thirds percent (66-2/3%) of the then aggregate unpaid
principal amount of the Loans, or, if no such principal amount is then
outstanding, Lenders having in excess of sixty-six and two-thirds percent
(66-2/3%) of the Total Aggregate Commitment.
"Mandatory Joint Venture Lot Purchase Obligations" means, at any time,
the aggregate dollar amount of all obligations provided as credit enhancements
to joint venture lenders (based on the purchase prices of the lots) of
Borrower and its Subsidiaries to purchase lots (whether finished lots or lots
under development) from any partnership, joint venture, limited liability
company, or similar entity in which Borrower or any Subsidiary is a partner,
venturer, or member, but in the case of each such entity, only to the extent
of indebtedness for borrowed money of such entity.
"Material Adverse Effect" means: (a) a material adverse change in, or a
material adverse effect upon, the operations, business, properties, or
condition (financial or otherwise) of Borrower and its Subsidiaries, taken as
a whole; (b) an impairment of the ability of Borrower to perform its payment
or other material obligations under any Loan Document to which it is a party;
or (c) a material adverse
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effect upon the legality, validity, binding effect, or enforceability against
Borrower of any material obligations of Borrower under any Loan Document to
which it is a party.
"Material Subsidiaries" means, as of any date, each Subsidiary of
Borrower (other than Excluded Subsidiaries) that owns assets (other than
ownership interests in, or intercompany indebtedness of, other Subsidiaries)
having a value determined in accordance with GAAP of $1,000,000 or more as of
such date. As of the Closing Date, all Material Subsidiaries are listed on
Schedule 8.9.
"Maturity Date" means the earlier of (a) October 31, 2005, subject to
possible extension pursuant to Section 4.17, and (b) the effective date of any
termination or cancellation of the Total Aggregate Commitment in accordance
with the terms of this Agreement.
"Measurement Period" has the meaning set forth in Section 8.21.
"Model Unit" means a Completed Unit to be used as a model home in
connection with the sale of Units in a residential housing project.
"Moody's" means ▇▇▇▇▇'▇ Investors Service, Inc. and any successor
thereto.
"Multiemployer Plan" means any employee benefit plan of the type
described in Section 4001(a)(3) of ERISA, to which Borrower or any ERISA
Affiliate makes or is obligated to make contributions, or during the preceding
five (5) plan years, has made or been obligated to make contributions.
"Non-Wholly Owned Subsidiary" means a Subsidiary, less than one hundred
percent (100%) of the capital stock of which (including voting and non-voting
shares, but exclusive of directors' qualifying shares) is owned by Borrower
and its Subsidiaries (other than Non-Wholly Owned Subsidiaries).
"Note" means each of the promissory notes, substantially in the form of
Exhibit E, executed by Borrower in favor of Lenders, each to the order of the
applicable Lender as payee to evidence such Lender's share of the Loans, and
each in the original principal amount of the applicable Lender's Commitment
such that the aggregate original principal amount of all Notes is initially
$450,000,000 (subject to possible increase as specified in Section 3.10).
"Obligations" means all advances to, and debts, liabilities,
obligations, covenants, and duties of, Borrower and Guarantors arising under
any Loan Document or otherwise with respect to any Loan or Letter of Credit,
whether direct or indirect (including those acquired by assumption), absolute
or contingent, due or to become due, now existing or hereafter arising and
including interest and fees that accrue after the commencement by or against
Borrower or any Guarantor or any Affiliate thereof of any proceeding under any
Debtor Relief Laws naming such Person as the debtor in such proceeding,
regardless of whether such interest and fees are allowed claims in such
proceeding.
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"Opinion of Counsel" means the favorable written legal opinion of
counsel to Borrower and its Subsidiaries, substantially in the form of Exhibit
F, together with copies of all factual certificates and legal opinions upon
which such counsel has relied.
"Other Taxes" has the meaning set forth in Section 4.5(b).
"PBGC" means the Pension Benefit Guaranty Corporation.
"Pension Plan" means any "employee pension benefit plan" (as such term
is defined in Section 3(2) of ERISA), other than a Multiemployer Plan, that is
subject to Title IV of ERISA and is sponsored or maintained by Borrower or any
ERISA Affiliate or to which Borrower or any ERISA Affiliate contributes or has
an obligation to contribute, or in the case of a multiple employer or other
plan described in Section 4064(a) of ERISA, has made contributions at any time
during the immediately preceding five plan years.
"Performance Letter of Credit" means any letter of credit issued: (a) on
behalf of a Person in favor of a Governmental Authority, including, without
limitation, any utility, water, or sewer authority, or other similar entity,
for the purpose of assuring such Governmental Authority that such Person or an
Affiliate of such Person will properly and timely complete work it has agreed
to perform for the benefit of such Governmental Authority; (b) in lieu of cash
deposits to obtain a license, in place of a utility deposit, or for land
option contracts; (c) in lieu of other contract performance, to secure
performance warranties payable upon breach, and to secure the performance of
labor and materials, including, without limitation, construction, bid, and
performance bonds; or (d) to secure refund or advance payments on contractual
obligations where default of a performance-related contract has occurred.
"Person" means any individual or entity, whether a trustee, corporation,
general partnership, limited partnership, limited liability company, joint
stock company, trust, unincorporated organization, bank, business association,
firm, joint venture, Governmental Authority, or otherwise.
"Plan" means any Pension Plan or Multiemployer Plan.
"Prime Rate" means for any day a fluctuating rate per annum equal to the
rate of interest in effect for such day as publicly announced from time to
time by Administrative Agent as its "prime rate." The "prime rate" is a rate
set by Administrative Agent based upon various factors including
Administrative Agent's costs and desired return, general economic conditions,
and other factors, and is used as a reference point for pricing some loans,
which may be priced at, above, or below such announced rate. Any change in
such rate announced by Administrative Agent shall take effect at the opening
of business on the day specified in the public announcement of such change.
"Pro Rata Share" means, with respect to each Lender at any time, a
fraction (expressed as a percentage, carried out to the ninth decimal place),
the numerator of which is the amount of the Commitment of such Lender at such
time and the denominator of which is the amount of the Total Aggregate
Commitment at such time; provided that if the commitment of each Lender to
make Loans and the obligation of the Issuing Banks to issue Letters of Credit
have been terminated pursuant to Section 9.2, then the Pro Rata Share of each
Lender shall be determined based on the Pro Rata Share
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of such Lender immediately prior to such termination and after giving effect
to any subsequent assignments made pursuant to the terms hereof.
"Project Financing Liens" means any deeds of trust, mortgages, or any
other liens which secure any real property acquisition loans, development
loans, construction loans, or any other loans pertaining to the acquisition
and/or development of, or construction of improvements upon, real property,
but excluding any lien referenced in Sections 8.11(b), (d), (e), (g), or (l).
"Rate Hedging Obligations" means, for any Person, the net obligations of
such Person pursuant to any interest rate hedging agreement or any foreign
exchange contract, currency swap agreement, or other similar agreement to
which such Person is a party or a beneficiary.
"Real Estate Inventory" means Unentitled Land, Entitled Land, Lots Under
Development, Units Under Construction, and Completed Units (including Model
Units).
"Reference Rate" means, as of any date, the higher of (a) the Prime
Rate, and (b) one half of one percent (0.50%) per annum above the Federal
Funds Rate. Any change in the Reference Rate shall take effect on the day
specified in the public announcement of such change.
"Reference Rate Borrowing" means any Loan or portion thereof which is
not designated or redesignated by Borrower as a Eurodollar Borrowing pursuant
to Sections 3.3 or 3.4.
"Regulation D" means Regulation D of the FRB as now or from time to time
hereafter in effect and any other regulation issued in substitution therefor.
"Reportable Event" means any of the events set forth in Section 4043(c)
of ERISA, other than events for which the thirty (30) day notice period has
been waived.
"Request for Borrowing" means a written request for a Borrowing
substantially in the form of Exhibit G, signed by a Responsible Official of
Borrower, and properly completed to provide all information required to be
included thereon.
"Request for Letter of Credit" means a written request for a Letter of
Credit substantially in the form of Exhibit H, signed by a Responsible
Official of Borrower, and properly completed to provide all information
required to be included thereon.
"Request for Redesignation of Borrowing" means a written request for
redesignation of Borrowing substantially in the form of Exhibit I, signed by a
Responsible Official of Borrower, and properly completed to provide all
information required to be included thereon.
"Responsible Official" means: (a) when used with reference to a Person
other than an individual, any corporate officer of such Person, general
partner of such Person, corporate officer of a corporate general partner of
such Person, or corporate officer of a corporate general partner of a
partnership that is a general partner of such Person, or any other responsible
official thereof duly acting on behalf thereof; and (b) when used with
reference to a Person who is an individual, such Person. Any document or
certificate hereunder that is signed or executed by a Responsible Official of
-15-
another Person shall be conclusively presumed to have been authorized by all
necessary corporate, partnership, and/or other action on the part of such
other Person.
"S&P" means Standard & Poor's Ratings Services, a division of The
▇▇▇▇▇▇-▇▇▇▇ Companies, Inc. and any successor thereto.
"Seller Nonrecourse Debt" means indebtedness which satisfies all of the
following criteria: (a) such indebtedness is incurred by Borrower or a
Subsidiary in connection with its purchase of one or more parcels of Real
Estate Inventory (the "Purchased Property"), and such indebtedness constitutes
the unpaid portion of the purchase price of the Purchased Property; (b) such
indebtedness is evidenced by a promissory note or other repayment agreement
which is secured by a deed of trust, mortgage, or similar lien on the
Purchased Property; and (c) such indebtedness is by its terms, or by operation
of law, nonrecourse to Borrower, its Subsidiaries, and its Affiliates.
"Senior Unsecured Home Building Debt" means, as of any date, the sum of
(a) Combined Senior Home Building Debt (excluding any Combined Senior Home
Building Debt to the extent such debt is (i) non-recourse to Borrower and its
Subsidiaries or (ii) secured by real property (but including the amount by
which the debt exceeds the value of the real property)), plus (b) all
reimbursement obligations with respect to drawn Performance Letters of Credit
and the face amount of all undrawn Performance Letters of Credit, in each case
issued for the account of, or guaranteed by, Borrower or any of its
Subsidiaries (other than Excluded Subsidiaries).
"Solvent" means, as to a Person, that (a) the aggregate fair market
value of such Person's assets exceeds its liabilities (whether contingent,
subordinated, unmatured, unliquidated, or otherwise), (b) such Person has not
incurred debts beyond such Person's ability to pay such debts as they mature
(taking into account all reasonably anticipated financing and refinancing
proceeds), and (c) such Person does not have unreasonably small capital to
conduct such Person's businesses. In computing the amount of contingent or
unliquidated liabilities at any time, such liabilities will be computed at the
amount which, in light of all the facts and circumstances existing at such
time, represents the amount that can reasonably be expected to become an
actual or matured liability discounted to present value at rates believed to
be reasonable by such Person.
"Special Circumstance" means the adoption of any Law or interpretation,
or any change therein or thereof, or any change in the interpretation,
administration or application thereof by any Governmental Authority, central
bank or comparable authority, or compliance by Lenders or their Eurodollar
Lending Offices with any request or directive (whether or not having the force
of Law) of any Governmental Authority, central bank, or comparable authority,
or the occurrence of circumstances affecting the applicable London interbank
eurodollar market generally which are beyond the reasonable control of
Lenders.
"Subordinated Debt" means: (a) Borrower's 9-1/4% Senior Subordinated
Notes due 2012; and (b) such indebtedness of Borrower that is subordinated to
the Obligations pursuant to terms and conditions approved in writing by the
Majority Lenders, and as to which Administrative Agent has received a legal
opinion, in form and substance reasonably satisfactory to Administrative
Agent, confirming the subordinate status of such indebtedness in relation to
the Obligations.
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"Subsequent Lender" has the meaning set forth in Section 3.10(b).
"Subsidiary" of a Person means a corporation, partnership, joint
venture, limited liability company, or other business entity (a) of which a
majority of the shares of securities or other interests having ordinary voting
power for the election of directors or other governing body (other than
securities or interests having such power only by reason of the happening of a
contingency) are at the time beneficially owned by such Person, or (b) (i) the
management of which is controlled, directly, or indirectly through one or more
intermediaries, or both, by such Person, and (ii) the results of operations of
which are required under GAAP to be consolidated with the results of such
Person. Unless otherwise specified, all references herein to a "Subsidiary" or
to "Subsidiaries" shall refer to a Subsidiary or Subsidiaries of Borrower.
"Subsidiary Letters of Credit" has the meaning set forth in Section
3.9(f).
"Swing Line Advances" means Borrowings initially funded by Swing Line
Lender in the manner provided in Section 3.1(h).
"Swing Line Lender" means Bank of America in its capacity as provider of
Swing Line Advances, or any successor swing line lender hereunder.
"Syndication Agent" means the Lender which is designated in writing by
Administrative Agent to serve as Syndication Agent hereunder (subject to
Section 10.13).
"Taxes" has the meaning set forth in Section 4.5(a).
"Temporary Cash Investments" means: (a) readily marketable, direct, full
faith, and credit obligations of the United States of America, or obligations
guaranteed by the full faith and credit of the United States of America,
maturing within not more than one (1) year from the date of acquisition; (b)
short term certificates of deposit and time deposits, which mature within one
(1) year from the date of issuance and which are at a Lender, are at a
domestic commercial bank having capital and surplus in excess of $100,000,000,
or are fully insured by the Federal Deposit Insurance Corporation; (c)
commercial paper or master notes maturing in 365 days or less from the date of
issuance and rated either "P-1" by Moody's, or "A-1" by S&P); (d) debt
instruments of a domestic issuer which mature in one (1) year or less and
which are rated "A" or better by Moody's or S&P on the date of acquisition of
such investment; (e) demand deposit accounts which are maintained in the
ordinary course of business; (f) short term tax exempt securities including
municipal notes, commercial paper, auction rate floaters , and floating rate
notes rated either "P-1" by Moodys or "A-1" by S&P; (g) marketable direct
obligations issued by any state of the United States of America or any
political subdivision of any such state or any public instrumentality thereof
maturing within ninety (90) days after the date of acquisition thereof and, at
the time of acquisition, having one (1) of the two (2) highest ratings
obtainable from any two of S&P, Moody's, or Fitch (or, if at any time no two
(2) of the foregoing shall be rating such obligations, then from such other
nationally recognized rating services acceptable to Administrative Agent );
(h) domestic corporate bonds, other than domestic corporate bonds issued by
Borrower or any of its Affiliates, maturing no more than two (2) years after
the date of acquisition thereof and, at the time of acquisition, having a
rating of at least A or the equivalent from any two (2) of S&P, Moody's, or
Fitch (or, if at any time no two (2) of the foregoing shall be rating such
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obligations, then from such other nationally recognized rating services
acceptable to Administrative Agent); and (i) shares of money market, mutual,
or similar funds which invest primarily in securities of the type described in
(a)-(h) above.
"Total Aggregate Commitment" means the total aggregate combined
Commitments of Lenders. The Total Aggregate Commitment currently equals
$450,000,000, and may increase as provided in Section 3.10 or decrease as
provided in Section 4.18 or Section 4.19.
"Total Leverage Ratio" means, as of any date, the ratio of (a) Combined
Total Home Building Debt to (b) Adjusted Consolidated Tangible Net Worth.
"Unencumbered Real Estate Inventory" means Real Estate Inventory which
is not subject to or encumbered by any deed of trust, mortgage, judgment lien,
attachment lien, or any other lien (other than liens which have been bonded
around so as to remove such liens as encumbrances against the Real Estate
Inventory in a manner satisfactory to Administrative Agent and its legal
counsel, or liens which are permitted under Section 8.11(b), (c), (j), or
(l)).
"Unentitled Land" means all land owned by Borrower and its Eligible
Subsidiaries which is not Entitled Land.
"Unit" means single family residential housing units owned by Borrower
or any Eligible Subsidiary that is a Guarantor.
"Units Under Construction" means Units where on-site construction has
commenced as evidenced by the trenching of foundations for such Units.
"Unreimbursed Amount" has the meaning set forth in Section 3.9(h)(i).
"Unsold Land" means the sum of all unsold (a) Finished Lots, (b) Lots
Under Development, (c) Entitled Land, and (d) Unentitled Land.
"Voting Stock" means any class or classes of securities having voting
power to elect the directors of a corporation.
"Wholly-Owned Subsidiary" means a Subsidiary, one hundred percent (100%)
of the capital stock of which is owned by Borrower and its Subsidiaries.
1.2 Number and Gender of Words; Other References. Unless otherwise
specified in the Loan Documents, (a) where appropriate, the singular includes
the plural and vice versa, and words of any gender include each other gender,
(b) heading and caption references may not be construed in interpreting
provisions, (c) monetary references are to currency of the United States of
America, (d) section, paragraph, annex, schedule, exhibit, and similar
references are to the particular Loan Document in which they are used, (e)
references to "telecopy," "facsimile," "fax," or similar terms are to
facsimile or telecopy transmissions, (f) references to "including" mean
including without limiting the generality of any description preceding or
following that word, (g) the rule of construction that references to general
items that follow references to specific items are limited to the same type or
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character of those specific items is not applicable in the Loan Documents, (h)
references to any Person include that Person's heirs, personal
representatives, successors, trustees, receivers, and permitted assigns, (i)
references to any Law include every amendment or supplement to it, rule and
regulation adopted under it, and successor or replacement for it, and (j)
references to any Loan Document or other document include every renewal,
extension, and restatement of it, amendment and supplement to it, and
replacement or substitution for it.
1.3 Accounting Terms.
(a) All accounting terms not specifically defined herein shall be
construed in conformity with, and all financial data required to be submitted
pursuant to this Agreement shall be prepared in conformity with, GAAP, as in
effect from time to time, applied in a manner consistent with that used in
preparing the Borrower's financial statements described in Section 7.5.
(b) Notwithstanding Section 1.3(a), if at any time any change in GAAP
or in any SEC rules and regulations (or the application of such rules and
regulations to Borrower) would affect the computation of any financial ratio,
covenant, or requirement set forth in any Loan Document, and either Borrower
or the Majority Lenders shall so request, then Administrative Agent, Lenders
and Borrower shall negotiate in good faith to amend such ratio, covenant, or
requirement to preserve the original intent thereof in light of such change
(subject to the approval of the Majority Lenders); provided that until so
amended (i) such ratio, covenant, or requirement shall continue to be computed
in accordance with GAAP without giving effect to such change therein, and (ii)
Borrower shall provide to Administrative Agent and Lenders financial
statements and other documents required under this Agreement or as reasonably
requested hereunder setting forth a reconciliation between calculations of
such ratio or requirement made before and after giving effect to such change.
1.4 Exhibits. All exhibits to this Agreement, either as now existing
or as the same may from time to time be supplemented, modified, or amended,
are incorporated herein by this reference.
1.5 Time References. Unless otherwise specified, all references herein
to times of day shall be references to Chicago, Illinois time (daylight or
standard, as applicable).
ARTICLE 2: RECITALS.
This Agreement is made with reference to the following facts:
(a) Borrower is primarily engaged in the business of developing
residential single-family housing projects.
(b) Borrower has applied to Lenders for the Loans to finance its
homebuilding operations and acquisitions in the United States of America and
for working capital needs and general corporate purposes.
(c) Lenders are willing to make the Loans to Borrower on the terms and
conditions set forth in this Agreement and in the other Loan Documents.
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ARTICLE 3: BORROWING PROCEDURES, BORROWING BASE, LETTER OF CREDIT SUBLIMIT,
AND POSSIBLE INCREASE IN TOTAL AGGREGATE COMMITMENT.
3.1 Disbursement of Loan Proceeds.
(a) Subject to the terms and conditions set forth in this Agreement,
at any time and from time to time from the Closing Date through the Business
Day immediately preceding the Maturity Date, each Lender severally and not
jointly agrees to make its Pro Rata Share of Loans to Borrower in such amounts
as Borrower may request that do not exceed in the aggregate at any one time
outstanding, the Commitment of such Lender (less such Lender's Pro Rata Share
of all L/C Obligations, if any). Subject to the limitations set forth herein,
Borrower may borrow, repay, and reborrow under each Lender's Commitment
without premium or penalty. In no event shall Lenders be obligated to make
Loans to Borrower at any time if, after giving effect to such Loans, the
provisions of Section 3.6 would be violated.
(b) Unless Administrative Agent otherwise consents, the aggregate
amount of each Eurodollar Borrowing shall be in an integral multiple of
$1,000,000, but not less than $5,000,000, and the aggregate amount of each
Reference Rate Borrowing shall be in an integral multiple of $100,000, but not
less than $500,000.
(c) The Loans made by Lenders pursuant to this Agreement shall be
evidenced by each Note.
(d) A Request for Borrowing shall be irrevocable upon receipt by
Administrative Agent. Administrative Agent shall not be bound by any
preliminary information that it may give Borrower concerning a particular
Eurodollar Rate before it delivers the binding Eurodollar Rate notice in
accordance with Section 3.3(b).
(e) Unless Administrative Agent otherwise consents, no more than ten
(10) Eurodollar Borrowings in the aggregate shall be outstanding at any one
time; provided, however, up to twelve (12) Eurodollar Borrowings in the
aggregate may be outstanding if Borrower pays to Administrative Agent an
additional fee of $250 per Eurodollar Borrowing with each Request for
Borrowing after the tenth (10th) such request.
(f) Administrative Agent will notify each Lender of its receipt of a
Request for Borrowing and of the amount of such Lender's Pro Rata Share of
that Borrowing by 1:00 p.m. on the date of timely receipt of a Request for
Borrowing by Borrower.
(g) Each Lender will make the amount of its Pro Rata Share of each
Borrowing available to Administrative Agent for the account of Borrower at
Administrative Agent's payment office (described on the signature page hereof)
by 1:00 p.m. on the date of such Borrowing requested by Borrower in funds
immediately available to Administrative Agent. Subject to the provisions of
Article 6 and Section 3.7, the proceeds of all such Loans will then be made
available to Borrower by
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Administrative Agent by wire transfer in accordance with written instructions
provided to Administrative Agent by Borrower of like funds as received by
Administrative Agent.
(h) The following procedures shall apply to Swing Line Advances:
(i) Not later than 3:30 p.m. on the Business Day on which a
proposed Swing Line Advance is to be made, Swing Line Lender must have
received in writing a request that a Swing Line Advance be made on that
Business Day, stating that such Advance shall be a Swing Line Advance,
and stating the amount of the requested Swing Line Advance.
(ii) The obligation of Swing Line Lender to make any Swing Line
Advances is subject to the conditions precedent in Section 6.2. Unless
Swing Line Lender has received notice (by telephone or in writing) from
Administrative Agent (including at the request of any Lender) prior to
4:00 p.m. on the date of the proposed Swing Line Advance that one or
more of the applicable conditions specified in Article 6 is not then
satisfied, then, subject to the terms and conditions hereof, Swing Line
Lender shall credit to the Account, from Swing Line Lender's funds, the
amount of the requested Swing Line Advance; provided, however, that
after giving effect to any Swing Line Advance, (A) the aggregate amount
of all Swing Line Advances does not exceed $50,000,000, (B) the
aggregate outstanding amount of Loans (including all Swing Line
Advances) plus the aggregate outstanding L/C Obligations shall not
exceed the Total Aggregate Commitment, and (C) the aggregate outstanding
amount of the Loans of any Lender, plus such Lender's Pro Rata Share of
the aggregate outstanding amount of all L/C Obligations, plus such
Lender's Pro Rata Share of the aggregate outstanding amount of all Swing
Line Advances shall not exceed such Lender's Commitment; and provided,
further, that Borrower shall not use the proceeds of any Swing Line
Advance to refinance any outstanding Swing Line Advance.
(iii) On or before 11:00 a.m. on the Business Day following the
Business Day on which a Swing Line Advance is made, Swing Line Lender
shall request, on behalf of Borrower (which hereby irrevocably
authorizes Swing Line Lender to so request on its behalf), that Lenders
make a Reference Rate Borrowing in the amount of such Swing Line
Advance.
(iv) Each Lender shall deliver to Administrative Agent (for the
benefit of Swing Line Lender) before 1:00 p.m. on the Business Day
following the Business Day on which notice has been sent to such Lender
under Section 3.1(h)(iii) immediately available funds in an amount equal
to such Lender's Pro Rata Share of such Reference Rate Borrowing.
Administrative Agent shall pay all such amounts received to Swing Line
Lender, which shall immediately apply such amounts to such Swing Line
Advance. Except to the extent expressly set forth herein, the obligation
of each Lender to make disbursements to Administrative Agent pursuant to
this Section 3.1(h)(iv) shall be absolute and unconditional.
(v) If for any reason any Swing Line Advance cannot be refinanced
by a Reference Rate Borrowing in accordance with Section 3.1(h)(iv), the
request for Reference Rate Borrowing submitted by Swing Line Lender as
set forth herein shall be deemed to be a request by Swing Line Lender
that each of the Lenders fund its risk participation in the
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relevant Swing Line Advance and each Lender's payment to Administrative
Agent for the account of Swing Line Lender pursuant to Section
3.1(h)(iii) shall be deemed payment in respect of such participation. In
such event, Swing Line Lender shall be deemed irrevocably and
unconditionally to have sold and transferred to each Lender without
recourse and, each Lender shall have deemed to have irrevocably and
unconditionally purchased and received, an undivided interest and
participation, to the extent of such Lender's Pro Rata Share, in all
outstanding Swing Line Advances. Each Lender shall promptly (and in any
event within two (2) Business Days) pay to Administrative Agent (for the
benefit of Swing Line Lender) in immediately available funds an amount
equal to such Lender's Pro Rata Share of the outstanding principal
amount of such Swing Line Advances. Administrative Agent shall pay all
amounts received to Swing Line Lender, which shall apply such amounts to
such Swing Line Advances. Any amount payable to Administrative Agent
(for the benefit of Swing Line Lender) pursuant to this Section
3.1(h)(v) and not paid within two (2) Business Days of the day on which
notice of such payment received from Administrative Agent shall bear
interest until paid at the Federal Funds Rate. If Lenders make any
payment in respect of Swing Line Advances as contemplated by this
Section 3.1(h)(v) and thereafter Administrative Agent or Swing Line
Lender receives a payment on account of any such Advance, then
Administrative Agent or Swing Line Lender, as appropriate, shall
promptly pay to each Lender which funded its participation therein an
amount equal to such Lender's Pro Rata Share thereof. The obligation of
each Lender to make payments under this Section 3.1(h)(v) shall be
unconditional and irrevocable and shall be made under all circumstances.
If any payment received on account of any Swing Line Advance and
distributed to a Lender as a participant under this Section 3.1(h)(v) is
thereafter recovered from Administrative Agent or Swing Line Lender in
connection with any bankruptcy or insolvency proceeding relating to
Borrower or otherwise, then each Lender which received such distribution
shall, upon demand by Administrative Agent, repay to Administrative
Agent or Swing Line Lender, as applicable, such Lender's Pro Rata Share
of the amount so recovered together with an amount equal to such
Lender's Pro Rata Share (according to the proportion of (A) the total of
such Lender's required repayment to (B) the total amount so recovered)
of any interest or other amount paid or payable by Administrative Agent
or Swing Line Lender in respect of the total amount so recovered.
(vi) Swing Line Lender shall not be obligated to make any Swing
Line Advance pursuant to this Section 3.1(h) if the making of such Swing
Line Advance would result in an aggregate amount of Swing Line Advances
which are outstanding and not reimbursed by Lenders pursuant to Section
3.1(h)(iv) in excess of $50,000,000. Swing Line Advances shall be
considered Borrowings for all purposes hereunder (including conditions
to disbursement but excluding the notice requirement of Section 3.2),
subject only to the special reimbursement obligations of Lenders
pursuant to this Section 3.1(h). If Swing Line Lender is excused from
its obligation to make a requested Swing Line Advance by this Section
3.1(h)(vi), then Borrower shall still be entitled to obtain the
requested Borrowing pursuant to the other provisions of Article 3,
subject to the conditions applicable to such Borrowings.
3.2 Reference Rate Borrowings. All Loans shall at all times constitute
Reference Rate Borrowings unless properly designated or redesignated as
Eurodollar Borrowings pursuant to
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Sections 3.3 or 3.4. Each request by Borrower for a new Reference Rate
Borrowing (except for Swing Line Advances) shall be made pursuant to a Request
for Borrowing received by Administrative Agent, at Administrative Agent's
Lending Office, not later than 11:00 a.m. at least one (1) Business Day prior
to the date the Reference Rate Borrowing is to be funded to Borrower.
Administrative Agent will notify each Lender of its receipt of a Request for
Borrowing in accordance with Section 3.1(f).
3.3 Eurodollar Borrowing.
(a) Each request by Borrower for a Eurodollar Borrowing shall be made
pursuant to a Request for Borrowing received by Administrative Agent, at
Administrative Agent's Lending Office, not later than 11:00 a.m. at least
three (3) Business Days before the first (1/st/) day of the applicable
Interest Period. Administrative Agent will notify each Lender of its receipt
of a Request for Borrowing in accordance with Section 3.1(f).
(b) At or about 11:00 a.m. one (1) Business Day after the Business Day
on which Administrative Agent receives Borrower's Request for Borrowing,
Administrative Agent shall determine the applicable Eurodollar Rate (which
determination shall be conclusive in the absence of manifest error) and shall
promptly give notice of the same to Borrower and Lenders by telephone or
telecopier.
(c) Upon fulfillment of the applicable conditions set forth in Article
6, a Eurodollar Borrowing shall become effective on the first (1/st/) day of
the applicable Interest Period.
(d) Administrative Agent in its sole discretion may require Borrower to
request any Eurodollar Borrowing of $100,000,000 or more, or any redesignation
of a Reference Rate Borrowing of $100,000,000 or more as a Eurodollar
Borrowing, at a time or on a day which is one (1) Business Day earlier than
the deadline stated above (or for redesignations of Reference Rate Borrowings,
stated in Section 3.4) for making such a request.
(e) Nothing contained herein shall require Lenders to fund any
Eurodollar Borrowing in the London interbank eurodollar market.
3.4 Redesignation of Borrowings.
(a) If any Eurodollar Borrowing is not repaid on the last day of the
applicable Interest Period, then such Borrowing automatically shall be
redesignated as a Reference Rate Borrowing on such date.
(b) Subject to the terms and conditions set forth in this Agreement, at
any time and from time to time from the Closing Date until one (1) month
preceding the Maturity Date, Borrower may request that all or a portion of
outstanding Reference Rate Borrowings be redesignated as a Eurodollar
Borrowing; provided that the Interest Period for such Eurodollar Borrowing
shall end on or before the Maturity Date.
(c) Each redesignation of all or a portion of outstanding Reference
Rate Borrowings as a Eurodollar Borrowing shall be made pursuant to a written
Request for Redesignation of Borrowing.
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Not later than 11:00 a.m. at least three (3) Business Days prior to the first
(1/st/) day of the applicable Interest Period, Administrative Agent shall have
received, at Administrative Agent's Lending Office, a properly completed
Request for Redesignation of Borrowing specifying (i) the requested date of
redesignation, (ii) the requested amount of Reference Rate Borrowings to be
redesignated as a Eurodollar Borrowing, and (iii) the requested Interest
Period. Administrative Agent may, in its sole and absolute discretion, permit
a Request for Redesignation of Borrowing to be made by telecopier or by
telephone (with confirmation sent promptly by telecopier) by Borrower, in
which case Borrower shall confirm same by mailing a written Request for
Redesignation of Borrowing to Administrative Agent within 24 hours following
the date of redesignation.
(d) Administrative Agent will notify each Lender of its receipt of a
Request for Redesignation by 1:00 p.m. on the date of timely receipt of a
Request for Redesignation from Borrower. All redesignations shall be made
ratably according to the respective outstanding principal amount of the Loans
with respect to which the Request for Redesignation was given is then held by
each Lender.
(e) Unless Administrative Agent otherwise consents, the amount of
Reference Rate Borrowings to be redesignated as a Eurodollar Borrowing shall
be an integral multiple of $1,000,000, but not less than $5,000,000.
(f) With respect to any redesignation of Reference Rate Borrowing as a
Eurodollar Borrowing, at or about 11:00 a.m. one (1) Business Day after the
Business Day on which Administrative Agent receives Borrower's Request for
Redesignation, Administrative Agent shall determine the applicable Eurodollar
Rate (which determination shall be conclusive in the absence of manifest
error) and shall promptly give notice of the same to Borrower and Lenders by
telephone or telecopier.
(g) Upon fulfillment of the applicable conditions set forth in this
Agreement, the redesignation of all or a portion of outstanding Reference Rate
Borrowings as a Eurodollar Borrowing shall become effective on the first
(1/st/) day of the applicable Interest Period.
(h) A Request for Redesignation of Borrowing shall be irrevocable upon
receipt by Administrative Agent.
(i) Nothing contained herein shall require Lenders to fund any
Eurodollar Borrowing resulting from redesignation of all or a portion of any
of the Reference Rate Borrowings in the London interbank eurodollar market.
(j) Notwithstanding anything herein to the contrary, unless all of
Lenders otherwise agree, during the existence of a Default or an Event of
Default, (i) Borrower may not elect to have a Loan converted into a Eurodollar
Borrowing and (ii) each Eurodollar Borrowing shall, on the last day of its
respective Interest Period, be redesignated as a Reference Rate Borrowing.
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3.5 Calculation of Borrowing Base.
(a) Borrowing Base Certificate; Approval. The Borrowing Base shall be
calculated at the times and in the manner set forth in this Section 3.5(a):
(i) Within forty-five (45) days after the end of each calendar
quarter, and at such other times as the Majority Lenders may reasonably
require (provided that such calculation is to be made as of the last day
of a calendar month), Borrower shall provide Administrative Agent with a
Borrowing Base Certificate showing Borrower's calculations of the
components of the Borrowing Base and such data supporting such
calculations as the Majority Lenders may require. The Majority Lenders
shall have a period of thirty (30) days following receipt of a Borrowing
Base Certificate to notify Administrative Agent (who shall notify
Borrower) of the Majority Lenders' approval or disapproval thereof.
Failure of the Majority Lenders to so notify Administrative Agent and
Administrative Agent to so notify Borrower within such thirty (30) day
period shall be deemed approval and such Borrowing Base as set forth in
such Borrowing Base Certificate shall be effective as of the date
approved (or deemed approved) by the Majority Lenders. The amount so
approved (or deemed approved) shall constitute the Borrowing Base until
such time as the Borrowing Base is redetermined in accordance with this
Section 3.5(a).
(ii) In the event that Administrative Agent (as requested by the
Majority Lenders) timely notifies Borrower of disapproval of a Borrowing
Base Certificate, then Administrative Agent shall, at the same time,
notify Borrower in writing of the amount of the Borrowing Base as
reasonably determined by the Majority Lenders and the basis of such
determination, and the effective date thereof (which shall be the date
of the giving of such notice by Administrative Agent), and such amount
shall thereupon and thereafter constitute the Borrowing Base which shall
remain in effect until such time as the Borrowing Base is redetermined
in accordance with this Section 3.5(a). The Majority Lenders and
Borrower shall each cooperate in good faith with the other in the
calculation of the Borrowing Base in circumstances where the Majority
Lenders disapprove a Borrowing Base Certificate prepared by Borrower.
(iii) Each determination of the Borrowing Base in accordance with
this Section 3.5(a) shall be binding and conclusive upon the parties
hereto, and provided that the Majority Lenders are not bound to rely on
information and figures provided by Borrower if the Majority Lenders
determine in good faith that it would be inappropriate to do so. Nothing
contained herein shall be deemed to restrict Borrower from submitting
additional Borrowing Base Certificates to Administrative Agent for the
Majority Lenders' approval at times other than those required hereunder.
(b) Amount of Borrowing Base. As used herein in the Agreement, the term
"Borrowing Base" shall have the meaning set forth in this Section 3.5(b):
(i) Except as set forth in Sections 3.5(b)(ii), (iii), and (iv),
the Borrowing Base shall consist of the Dollar amount equal to the sum
of the following Unencumbered Real Estate Inventory owned by Borrower or
any Eligible Subsidiary that is a Guarantor:
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(A) Entitled Land. Fifty percent (50%) of the GAAP Value of
all Entitled Land (subject to the twenty percent (20%) limitation
specified in Section 3.5(b)(iii)); plus
(B) Lots Under Development. Sixty-five percent (65%) of the
GAAP Value of all Lots Under Development; plus
(C) Units Under Construction and Completed Units. Ninety
percent (90%) of the GAAP Value of all Units Under Construction and
Completed Units (subject to adjustment for Completed Units as set
forth in Section 3.5(b)(ii)); plus
(D) Escrow Proceeds Receivable. One hundred percent (100%)
of the amount of Escrow Proceeds Receivable.
(ii) Advance rates for Completed Units shall decrease as follows
with the passage of time following the dates such Units become Completed
Units: (A) 180 days following the date such Units become Completed Units
(other than with respect to Model Units, as to which clause (C) shall
apply) the applicable advance rate shall decrease from ninety percent
(90%) (as specified in Section 3.5(b)(i)(C) above) to fifty percent
(50%); (B) 360 days following the date that such Units become Completed
Units (other than with respect to Model Units, as to which clause (C)
shall apply) the applicable advance rate shall decrease from fifty
percent (50%) to zero percent (0%) (i.e., no value shall be attributed
to the Borrowing Base); and (C) with respect to Model ▇▇▇▇▇, ▇▇▇ days
following the sale of the last production Unit in the applicable project
relating to such Model Unit, the applicable advance rate for such Model
Units shall decrease from ninety percent (90%) (as specified in Section
3.5(b)(i)(C) above) to zero percent (0%) (i.e., no value shall be
attributed to the Borrowing Base).
(iii) Anything in this Agreement to the contrary notwithstanding,
in the event that more than twenty percent (20%) of the Borrowing Base
is attributable to Entitled Land, then any Entitled Land in excess of
such twenty percent (20%) limitation shall have a zero percent (0%)
advance rate (i.e., shall add no value to the Borrowing Base).
(iv) Only Real Estate Inventory which is Unencumbered Real Estate
Inventory may be added to the Borrowing Base. Any Real Estate Inventory
that is not Unencumbered Real Estate Inventory shall have no value for
purposes of the Borrowing Base (i.e., a zero percent (0%) advance rate).
Furthermore, Unentitled Land shall have no value for purposes of the
Borrowing Base (i.e., a zero percent (0%) advance rate). Once Units or
any other Real Estate Inventory are sold and conveyed to a buyer, or
otherwise cease to be owned by Borrower (or any Eligible Subsidiary that
is a Guarantor), the applicable advance rate shall decrease to zero
percent (0%), and Borrower shall not be entitled to have any value for
such assets attributed to the Borrowing Base.
3.6 Borrowing Base. The sum of the aggregate principal amount at any
time outstanding under the Loans plus the L/C Obligations shall not at any
time exceed either (a) the Total Aggregate Commitment, or (b) the Borrowing
Base less Senior Unsecured Home Building Debt (exclusive of the outstanding
amount of the Loans and L/C Obligations).
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3.7 Payments by Lenders to Administrative Agent.
(a) Unless Administrative Agent receives notice from a Lender on or
prior to the Closing Date or, with respect to any Borrowing after the Closing
Date, at least one (1) Business Day prior to the date of such Borrowing, that
such Lender will not make available as and when required hereunder to
Administrative Agent for the account of Borrower the amount of that Lender's
Pro Rata Share of the Borrowing, Administrative Agent may assume that each
Lender has made such amount available to Administrative Agent in immediately
available funds on the date of Borrowing and Administrative Agent may (but
shall not be so required), in reliance upon such assumption, make available to
Borrower on such date a corresponding amount. If and to the extent any Lender
shall not have made its full amount available to Administrative Agent in
immediately available funds as and when required hereunder, that Lender shall
on the Business Day following such date of Borrowing make such amount
available to Administrative Agent, together with interest at the Federal Funds
Rate for each day during such period. A notice from Administrative Agent
submitted to any Lender with respect to amounts owing under this subsection
(a) shall be conclusive, absent manifest error. If such amount is so made
available, then such payment to Administrative Agent shall constitute such
Lender's Loan on the date of Borrowing for all purposes of this Agreement. If
such amount is not made available to Administrative Agent on the Business Day
following the date of Borrowing, then Administrative Agent will notify
Borrower of such failure to fund and, upon demand by Administrative Agent,
Borrower shall pay such amount to Administrative Agent for Administrative
Agent's account, together with accrued interest thereon for each day elapsed
since the date of such Borrowing, at a rate per annum equal to the interest
rate applicable at the time to the Loans comprising such Borrowing.
(b) The failure of any Lender to make any Loan on any date of Borrowing
shall not relieve any other Lender of any obligation hereunder to make a Loan
on such date of Borrowing, but no Lender shall be responsible for the failure
of any other Lender to make the Loan to be made by such other Lender on any
date of Borrowing.
3.8 Sharing of Payments, Etc. If, other than as expressly provided
elsewhere herein, any Lender shall obtain on account of the Obligations made
by it any payment (whether voluntary, involuntary, through the exercise of any
right of set-off, or otherwise) in excess of its Pro Rata Share, such Lender
shall immediately (a) notify Administrative Agent of such fact, and (b)
purchase from the other Lenders such participations in the Obligations made by
them as shall be necessary to cause such purchasing Lender to share the excess
payment pro rata with each of them; provided, however, that if all or any
portion of such excess payment is thereafter recovered from the purchasing
Lender, such purchase shall to that extent be rescinded and each other Lender
shall repay to the purchasing Lender the purchase price paid therefor,
together with an amount equal to such paying Lender's ratable share (according
to the proportion of (i) the amount of such paying Lender's required repayment
to (ii) the total amount so recovered from the purchasing Lender) of any
interest or other amount paid or payable by the purchasing Lender in respect
of the total amount so recovered. Borrower agrees that any Lender so
purchasing a participation from another Lender may, to the fullest extent
permitted by law, exercise all its rights of payment (including the right of
set-off, but subject to Section 11.7) with respect to such participation as
fully as if such Lender were the direct creditor of Borrower in the amount of
such participation. Administrative Agent will keep records (which shall be
conclusive and
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binding in the absence of manifest error) of participations purchased under
this Section 3.8 and will in each case notify Lenders following any such
purchases or repayments.
3.9 Letter of Credit Sublimit.
(a) Amount and Terms of the Credit. Subject to the terms and upon the
conditions of this Agreement, an Issuing Bank shall issue letters of credit
for the account of Borrower and the Letter of Credit Subsidiaries from time to
time up to but not including the L/C Commitment Termination Date. The maximum
aggregate principal amount which remains undrawn under all outstanding Letters
of Credit (the "L/C Obligations") under this Agreement shall not exceed at any
one time outstanding the aggregate principal sum of ONE HUNDRED MILLION
DOLLARS ($100,000,000) (the "L/C Commitment").
(b) Amounts and Terms of Standby Letters of Credit . During the period
from the date of this Agreement to, but excluding the L/C Commitment
Termination Date, and subject to the terms and conditions of this Agreement,
upon Borrower's request pursuant to Section 3.9(c), an Issuing Bank shall
issue one or more Financial Letters of Credit or Performance Letters of Credit
(each, a "Letter of Credit," and collectively, the "Letters of Credit") for
the account of Borrower or the account of a Letter of Credit Subsidiary;
provided that no Issuing Bank shall be obligated to issue any Letter of Credit
if, after giving effect thereto, (i) the L/C Obligations would exceed the L/C
Commitment, or (ii) the total aggregate outstanding Loans plus the L/C
Obligations would exceed the Total Aggregate Commitment, or (iii) the Senior
Unsecured Home Building Debt would exceed the Borrowing Base, or (iv) the
issuance of such Letter of Credit would violate one or more policies of such
Issuing Bank. All Letters of Credit shall be on the applicable Issuing Bank's
standard forms of letters of credit at the time of issuance. No Letter of
Credit shall have an expiration date (unless Lenders otherwise consent in
writing) later than thirty (30) days prior to the Maturity Date.
(c) Request for Credit. Borrower, on or after the date of this
Agreement, shall give an Issuing Bank notice of its request for the issuance
of a Letter of Credit by delivering to such Issuing Bank (with a copy to
Administrative Agent) a Request for Letter of Credit and a duly executed and
completed L/C Application on such Issuing Bank's then current form (herein, an
"L/C Application") not later than 11:00 a.m. at least four (4) Business Days
prior to the proposed issuance date. Such Request for Letter of Credit shall
specify: (i) the date on which the issuance of Letter of Credit is requested
to be made (which day shall be a Business Day); and (ii) the amount of the
Letter of Credit.
(d) Issuance Fees. For each Letter of Credit issued by an Issuing Bank
(and upon any renewal thereof), Borrower shall pay (i) to Administrative
Agent, for the account of each Lender in accordance with its Pro Rata Share,
from Borrower's own funds a fee equal to the Applicable Margin for Eurodollar
Borrowings times the undrawn dollar amount of the Letter of Credit, and (ii)
to Administrative Agent, for the account of the applicable Issuing Bank, from
Borrower's own funds a fee equal to the greater of (A) .125% per annum (based
on a 360-day year) times the undrawn dollar amount of the Letter of Credit,
and (B) $250 (collectively, the "Issuance Fee"). The Issuance Fee payable
under clauses (i) and (ii) above shall be payable quarterly in arrears on the
first (1/st/) Business Day of each January, April, July, and October of each
year and on the Maturity Date.
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(e) Conditions Precedent to Issuance of Letters of Credit. The
obligation of any Issuing Bank to issue, increase, or renew any Letter of
Credit requested by Borrower is subject to satisfaction of the following
conditions precedent:
(i) Conditions to Loans shall be Satisfied. Each of the
conditions specified in Sections 6.1 and 6.2 to Borrowings shall also be
applicable as conditions precedent to the issuance, increase, or renewal
of any Letter of Credit.
(ii) L/C Application. The Issuing Bank requested to issue the
Letter of Credit shall have received from Borrower, in form and
substance satisfactory to such Issuing Bank, (A) a duly executed and
completed L/C Application which L/C Application shall set forth, among
other things, the beneficiary, the amount, and the term of the proposed
Letter of Credit, and (B) a duly executed and completed Request for
Letter of Credit (in the form of Exhibit H).
(iii) Issuing Bank Approval. The Issuing Bank requested to issue,
increase, or renew the Letter of Credit shall have determined that the
amount of any requested, increased, or renewed Letter of Credit, the
beneficiary thereof, and the other terms contained in the documents
pertaining to such Letter of Credit are satisfactory to such Issuing
Bank in the exercise of its reasonable discretion.
(iv) Payment of Fees. In addition to the fees described in Section
3.9(d), Borrower shall pay directly to the applicable Issuing Bank its
customary issuance, presentation, amendment, and other processing fees,
and all other standard costs and charges of such Issuing Bank relating
to letters of credit as from time to time in effect.
(v) Telephone Confirmation. Prior to the issuance, increase, or
renewal of any Letter of Credit, the applicable Issuing Bank shall
confirm by telephone with Administrative Agent that, following the
issuance, increase, or renewal of such Letter of Credit, none of the
limitations set forth in Section 3.9 would be violated and that all
conditions precedent to such issuance have been satisfied.
(f) Subsidiary Letters of Credit. Borrower has requested that Letters
of Credit from time to time upon its request be issued by an Issuing Bank (the
"Subsidiary Letters of Credit") with Borrower and any one or more of
Borrower's Subsidiaries or Home Building Joint Ventures (collectively, the
"Letter of Credit Subsidiaries") as the "account parties" (which would be
liable under the reimbursement agreements pertaining to such Subsidiary
Letters of Credit) thereunder. Subsidiary Letters of Credit shall constitute
"Letters of Credit" hereunder, and all terms and conditions specified above in
this Section 3.9 with respect to Letters of Credit shall be applicable to such
Subsidiary Letters of Credit. Without limiting the foregoing, any draws under
such Subsidiary Letters of Credit shall constitute Loans hereunder which
Borrower is obligated to repay (as more fully set forth in Section 3.9(b)(ii)
above), all amounts remaining undrawn on under all such Subsidiary Letters of
Credit shall constitute part of the "L/C Obligations," and the fees and
issuance procedures shall be as specified above. In addition to all terms and
conditions specified in Section 3.9(e) above to the issuance of Letters of
Credit, it shall be a condition to the issuance of any Subsidiary Letter of
Credit that Borrower shall have executed the Guaranty of the Subsidiary
Letters of Credit as well as such
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other documents as the applicable Issuing Bank and/or Administrative Agent may
reasonably request (and shall have reaffirmed such guaranty from time to time
upon Administrative Agent's request). All waivers and releases made by
Borrower which are set forth in the Guaranty of the Subsidiary Letters of
Credit are incorporated herein by this reference and shall also be applicable
to any Loans (and Borrower's obligation to repay such Loans) made or to be
made under Section 3.9(b)(ii) with respect to draws under the Subsidiary
Letters of Credit.
(g) Existing Letters of Credit. All Existing Letters of Credit shall be
deemed to have been issued pursuant hereto, and from and after the Closing
Date, shall be subject to and governed by the terms and conditions hereof.
(h) Drawings and Reimbursements; Funding of Participations.
(i) Upon receipt from the beneficiary of any Letter of Credit of
any notice of a drawing under such Letter of Credit, the applicable
Issuing Bank shall notify Borrower and Administrative Agent thereof. Not
later than 1:00 p.m. on the date of any payment by an Issuing Bank under
a Letter of Credit (each such date, an "Honor Date"), Borrower shall
reimburse such Issuing Bank through Administrative Agent in an amount
equal to the amount of such drawing; provided that if the notice of
drawing described in the preceding sentence is not received by Borrower
by 12:00 noon, then Borrower shall reimburse such Issuing Bank by 1:00
p.m. on the next succeeding Business Day in an amount equal to the
amount of such drawing together with interest at the rate applicable to
Reference Rate Borrowings. If Borrower fails to so reimburse such
Issuing Bank by such time, then Administrative Agent shall promptly
notify each Lender of the Honor Date, the amount of the unreimbursed
drawing (together with any interest thereon, the "Unreimbursed Amount"),
and the amount of such Lender's Pro Rata Share thereof. In such event,
Borrower shall be deemed to have requested a Reference Rate Borrowing to
be disbursed on the Honor Date in an amount equal to the Unreimbursed
Amount, without regard to the minimum and multiples specified in Section
3.1 for the principal amount of Reference Rate Borrowings, but subject
to the amount of the unutilized portion of the Total Aggregate
Commitment and the conditions set forth in Article 6 (other than the
delivery of a Request for Borrowing). Any notice given by an Issuing
Bank or Administrative Agent pursuant to this Section 3.9(h)(i) may be
given by telephone if immediately confirmed in writing; provided that
the lack of such an immediate confirmation shall not affect the
conclusiveness or binding effect of such notice.
(ii) Each Lender (including each Lender acting as an Issuing Bank)
shall upon any notice pursuant to Section 3.9(h)(i) make funds available
to Administrative Agent for the account of the applicable Issuing Bank
at Administrative Agent's Lending Office in an amount equal to its Pro
Rata Share of the Unreimbursed Amount not later than 3:00 p.m. on the
Business Day specified in such notice by Administrative Agent,
whereupon, subject to the provisions of Section 3.9(h)(iii), each Lender
that so makes funds available shall be deemed to have made a Reference
Rate Borrowing to Borrower in such amount. Administrative Agent shall
remit the funds so received to the applicable Issuing Bank.
(iii) With respect to any Unreimbursed Amount that is not fully
refinanced by a Reference Rate Borrowing because the conditions set
forth in Article 6 cannot be satisfied or
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for any other reason, Borrower shall be deemed to have incurred from the
applicable Issuing Bank an L/C Borrowing in the amount of the
Unreimbursed Amount that is not so refinanced, which L/C Borrowing shall
be due and payable on demand (together with interest) and shall bear
interest at the Default Rate. In such event, each Lender's payment to
Administrative Agent for the account of the applicable Issuing Bank
pursuant to Section 3.9(h)(ii) shall be deemed payment in respect of its
participation in such L/C Borrowing and shall constitute an L/C Advance
from such Lender in satisfaction of its participation obligation under
this Section 3.9.
(iv) Until each Lender funds its Reference Rate Borrowing or L/C
Advance pursuant to this Section 3.9(h) to reimburse the applicable
Issuing Bank for any amount drawn under any Letter of Credit, interest
in respect of such Lender's Pro Rata Share of such amount shall be
solely for the account of the applicable Issuing Bank.
(v) Each Lender's obligation to make Reference Rate Borrowings or
L/C Advances to reimburse each Issuing Bank for amounts drawn under
Letters of Credit, as contemplated by this Section 3.9(h), shall be
absolute and unconditional and shall not be affected by any
circumstance, including: (A) any set-off, counterclaim, recoupment,
defense, or other right which such Lender may have against the
applicable Issuing Bank, Borrower, or any other Person for any reason
whatsoever; (B) the occurrence or continuance of a Default or Event of
Default; or (C) any other occurrence, event, or condition, whether or
not similar to any of the foregoing; provided, however, that each
Lender's obligation to make Reference Rate Loans pursuant to this
Section 3.9(h) is subject to the conditions set forth in Article 6
(other than delivery by Borrower of a Notice of Borrowing). No such
making of an L/C Advance shall relieve or otherwise impair the
obligation of Borrower to reimburse the applicable Issuing Bank for the
amount of any payment made by the applicable Issuing Bank under any
Letter of Credit, together with interest as provided herein.
(vi) If any Lender fails to make available to Administrative Agent
for the account of the applicable Issuing Bank any amount required to be
paid by such Lender pursuant to the foregoing provisions of this Section
3.9(h) by the time specified in Section 3.9(h)(ii), the applicable
Issuing Bank shall be entitled to recover from such Lender (acting
through Administrative Agent), on demand, such amount with interest
thereon for the period from the date such payment is required to the
date on which such payment is immediately available to the applicable
Issuing Bank at a rate per annum equal to the Federal Funds Rate from
time to time in effect. A certificate of the applicable Issuing Bank
submitted to any Lender (through Administrative Agent) with respect to
any amounts owing under this Section 3.9(h)(vi) shall be conclusive
absent manifest error.
(i) Repayment of Participations.
(i) At any time after an Issuing Bank has made a payment under any
Letter of Credit and has received from any Lender such Lender's L/C
Advance in respect of such payment in accordance with Section 3.9(h), if
Administrative Agent receives for the account of such Issuing Bank any
payment in respect of the related Unreimbursed Amount or interest
thereon (whether directly from Borrower or otherwise, including proceeds
of cash collateral
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applied thereto by Administrative Agent), Administrative Agent will
distribute to such Lender its Pro Rata Share thereof (appropriately
adjusted, in the case of interest payments, to reflect the period of
time during which such Lender's L/C Advance was outstanding) in the same
funds as those received by Administrative Agent.
(ii) If any payment received by Administrative Agent for the
account of an Issuing Bank pursuant to Section 3.9(h)(i) is required to
be returned under any of the circumstances described in Section 11.4
(including pursuant to any settlement entered into by such Issuing Bank
in its discretion), each Lender shall pay to Administrative Agent for
the account of such Issuing Bank its Pro Rata Share thereof on demand of
Administrative Agent, plus interest thereon from the date of such demand
to the date such amount is returned by such Lender, at a rate per annum
equal to the Federal Funds Rate from time to time in effect.
(j) Obligations Absolute. The obligation of Borrower to reimburse each
Issuing Bank for each drawing under each Letter of Credit and to repay each
L/C Borrowing shall be absolute, unconditional, and irrevocable, and shall be
paid strictly in accordance with the terms of this Agreement under all
circumstances, including the following:
(i) any lack of validity or enforceability of such Letter
of Credit, this Agreement, or any other agreement or instrument relating
thereto;
(ii) the existence of any claim, counterclaim, set-off,
defense, or other right that Borrower or any Letter of Credit Subsidiary
may have at any time against any beneficiary or any transferee of such
Letter of Credit (or any Person for whom any such beneficiary or any
such transferee may be acting), the applicable Issuing Bank, or any
other Person, whether in connection with this Agreement, the
transactions contemplated hereby, or by such Letter of Credit or any
agreement or instrument relating thereto, or any unrelated transaction;
(iii) any draft, demand, certificate, or other document
presented under such Letter of Credit proving to be forged, fraudulent,
invalid, or insufficient in any respect or any statement therein being
untrue or inaccurate in any respect; or any loss or delay in the
transmission or otherwise of any document required in order to make a
drawing under such Letter of Credit;
(iv) any payment by the applicable Issuing Bank under such
Letter of Credit against presentation of a draft or certificate that
does not strictly comply with the terms of such Letter of Credit; or any
payment made by the applicable Issuing Bank under such Letter of Credit
to any Person purporting to be a trustee in bankruptcy,
debtor-in-possession, assignee for the benefit of creditors, liquidator,
receiver, or other representative of or successor to any beneficiary or
any transferee of such Letter of Credit, including any arising in
connection with any proceeding under any Debtor Relief Law; or
(v) any other circumstance or happening whatsoever, whether
or not similar to any of the foregoing, including any other circumstance
that might otherwise
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constitute a defense available to, or a discharge of, Borrower or any
Letter of Credit Subsidiary.
Borrower and each Letter of Credit Subsidiary shall promptly examine a copy of
each Letter of Credit and each amendment thereto that is delivered to it and,
in the event of any claim of noncompliance with Borrower's or any Letter of
Credit Subsidiary's instructions or other irregularity, Borrower and such
Letter of Credit Subsidiary will immediately notify the applicable Issuing
Bank. Borrower and each Letter of Credit Subsidiary shall be conclusively
deemed to have waived any such claim against the applicable Issuing Bank and
its correspondents unless such notice is given as aforesaid.
(k) Role of Issuing Bank. Each Lender and Borrower agree that, in
paying any drawing under a Letter of Credit, no Issuing Bank shall have any
responsibility to obtain any document (other than any sight draft,
certificates, and documents expressly required by the Letter of Credit) or to
ascertain or inquire as to the validity or accuracy of any such document or
the authority of the Person executing or delivering any such document. No
Issuing Bank, no Agent-Related Person, nor any of their respective
correspondents, participants, or assignees shall be liable to any Lender for
(i) any action taken or omitted in connection herewith at the request or with
the approval of the Lenders or the Required Lenders, as applicable, (ii) any
action taken or omitted in the absence of gross negligence or willful
misconduct, or (iii) the due execution, effectiveness, validity, or
enforceability of any document or instrument related to any Letter of Credit
or L/C Application. Borrower hereby assumes all risks of the acts or omissions
of any beneficiary or transferee with respect to its use of any Letter of
Credit; provided, however, that this assumption is not intended to, and shall
not, preclude Borrower's pursuing such rights and remedies as it may have
against the beneficiary or transferee at law or under any other agreement. No
Issuing Bank, no Agent-Related Person, nor any of their respective
correspondents, participants, or assignees shall be liable or responsible for
any of the matters described in clauses (i) through (v) of Section 3.9(j);
provided, however, that anything in such clauses to the contrary
notwithstanding, Borrower may have a claim against an Issuing Bank, and an
Issuing Bank may be liable to Borrower, to the extent, but only to the extent,
of any direct, as opposed to consequential or exemplary, damages suffered by
Borrower which were caused by such Issuing Bank's willful misconduct or gross
negligence or such Issuing Bank's willful failure to pay under any Letter of
Credit after the presentation to it by the beneficiary of a sight draft and
certificate(s) strictly complying with the terms and conditions of a Letter of
Credit. In furtherance and not in limitation of the foregoing, each Issuing
Bank may accept documents that appear on their face to be in order, without
responsibility for further investigation, regardless of any notice or
information to the contrary, and no Issuing Bank shall be responsible for the
validity or sufficiency of any instrument transferring or assigning or
purporting to transfer or assign a Letter of Credit or the rights or benefits
thereunder or proceeds thereof, in whole or in part, which may prove to be
invalid or ineffective for any reason.
(l) Indemnification by Lenders. Each Lender shall, ratably in
Accordance with its Pro Rata Share, indemnify each Issuing Bank and its
respective directors, officers, agents, and employees (to the extent not
reimbursed by Borrower) against any cost, expense, (including Attorney Costs),
claim, demand, action, loss, or liability (except such as result from such
indemnitees' gross negligence or willful misconduct or such Issuing Bank's
failure to pay under any Letter of Credit after the presentation to it of a
request strictly complying with the terms and conditions of the Letter of
Credit) that such indemnitees may suffer or incur
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in connection with this Section 3.9 or any action taken or omitted by such
indemnitees hereunder.
(m) Applicability of ISP98. Unless otherwise expressly agreed by the
applicable Issuing Bank and Borrower when a Letter of Credit is issued, the
rules of the International Standby Practices 1998 published by the Institute
of International Banking Law & Practice (or such later version thereof as may
be in effect at the time of issuance) shall apply to each standby Letter of
Credit.
(n) Conflict with L/C Application. In the event of any conflict between
the terms hereof and the terms of any L/C Application, the terms hereof shall
control.
(o) Letter of Credit Information. Administrative Agent and each Issuing
Bank shall provide to Lenders periodic information, but not more often than
quarterly, regarding outstanding Letters of Credit (including issue date,
expiry date, beneficiary, and amount), the amount of L/C Obligations, and each
Lender's Pro Rata Share thereof.
3.10 Possible Increase in Total Aggregate Commitment.
(a) Lenders on the Closing Date shall be Lenders set forth on Schedule
1.1(a) on the Closing Date.
(b) At any time after the Closing Date and prior to the date that is
ninety (90) days prior to the Maturity Date, Administrative Agent shall,
without the consent of Lenders (except as specified in this Section 3.10),
from time to time at the request of Borrower, increase the Total Aggregate
Commitment by (i) admitting additional Lenders hereunder (each a "Subsequent
Lender"), or (ii) increasing the Commitment of any Lender (each an "Increasing
Lender"), subject to the following conditions:
(A) each Subsequent Lender is an Eligible Assignee;
(B) Borrower executes (x) a new Note payable to the order of a
Subsequent Lender, or (y) a replacement Note payable to the order of an
Increasing Lender;
(C) each Subsequent Lender executes and delivers to Administrative
Agent a signature page to this Agreement;
(D) after giving effect to the admission of any Subsequent Lender
or the increase in the Commitment of any Increasing Lender, the Total
Aggregate Commitment does not exceed $550,000,000;
(E) each increase in the Total Aggregate Commitment shall be in
the amount of $10,000,000 or a greater integral multiple of $1,000,000;
(F) no admission of any Subsequent Lender shall increase the
Commitment of any existing Lender without the written consent of such
Lender;
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(G) no Default or Event of Default exists;
(H) no Lender shall be an Increasing Lender without the written
consent of such Lender; and
(I) Administrative Agent and the applicable Subsequent Lender or
Increasing Lender, as the case may be, are satisfied that after giving
effect to the increase in the Total Aggregate Commitment, the
Obligations constitute "senior debt" under all Subordinated Debt of
Borrower.
After the admission of any Subsequent Lender or increase in the Commitment of
any Increasing Lender, Administrative Agent shall promptly provide to each
Lender and to Borrower a new Schedule 1.1(a) to this Agreement (and each
Lender acknowledges that its percentage obligation under such Schedule will
change in accordance with its Pro Rata Share of the increased Total Aggregate
Commitment).
ARTICLE 4: PAYMENTS AND FEES; EXTENSION OPTION.
4.1 Principal and Interest.
(a) Interest shall be payable on the outstanding daily unpaid principal
amount of each Borrowing from the date thereof until payment in full is made
and shall accrue and be payable at the rates set forth herein both before and
after default and before and after maturity and judgment, with interest on
overdue interest to bear interest at the rate specified in Section 4.4. Upon
any partial prepayment or redesignation of outstanding Reference Rate
Borrowings, interest accrued through the date of such prepayment or
redesignation shall be payable on the next following Interest Payment Date and
shall be deducted from the Account on such date. Insufficient funds in the
Account shall not excuse Borrower's obligation to pay accrued interest on the
Interest Payment Date. Upon any partial prepayment or payment in full or
redesignation or conversion of any Eurodollar Borrowing, or upon any payment
or redesignation in full of all outstanding Reference Rate Borrowings,
interest accrued through the date of such prepayment, payment, redesignation,
or conversion shall be payable on the next following Interest Payment Date.
(b) Interest on each Reference Rate Borrowing shall be computed on the
basis of a year of 360 days and the actual number of days elapsed, at the
Reference Rate times the total principal balance outstanding of Loans bearing
interest at the Reference Rate under each Note. Interest accrued on each
Reference Rate Borrowing shall be payable on each Interest Payment Date,
commencing with the first such date to occur after the Closing Date, and shall
be deducted from the Account on each such Interest Payment Date. Insufficient
funds in the Account shall not excuse Borrower's obligation to pay accrued
interest on the Interest Payment Date. Administrative Agent shall use its best
efforts to notify Borrower of the amount of interest so payable prior to each
Interest Payment Date, but failure of Administrative Agent to do so shall not
excuse payment of such interest when payable. Except as otherwise provided in
Section 4.4, the unpaid principal amount of any Reference Rate Borrowing shall
bear interest at a fluctuating rate per annum equal to the Reference Rate plus
the Applicable Margin, if any, applicable to Reference Rate Borrowings. Each
change in the interest rate shall take effect simultaneously with the
corresponding change in the Reference Rate. Each change in the Reference
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Rate shall be effective as of 12:01 a.m. on the Business Day on which the
change in the Reference Rate is announced, unless otherwise specified in such
announcement, in which case the change shall be effective as so specified.
(c) Interest on each Eurodollar Borrowing shall be computed on the
basis of a year of 360 days and the actual number of days elapsed. Interest
accrued on each Eurodollar Borrowing shall be payable on each Interest Payment
Date and shall be deducted from the Account on such date. Insufficient funds
in the Account shall not excuse Borrower's obligation to pay accrued interest
on the Interest Payment Date. Administrative Agent shall use its best efforts
to notify Borrower of the amount of interest so payable prior to each such
date, but failure of Administrative Agent to do so shall not excuse payment of
such interest when payable. Except as otherwise provided in Section 4.4, the
unpaid principal amount of any Eurodollar Borrowing shall bear interest at a
rate per annum equal to the Eurodollar Rate for that Eurodollar Borrowing plus
the Applicable Margin applicable to Eurodollar Borrowings.
(d) If not sooner paid as required herein, then the principal
indebtedness evidenced by each Note shall be payable as follows:
(i) the amount, if any, by which the principal indebtedness
evidenced by each Note at any time exceeds the applicable Lender's
Commitment shall be payable immediately;
(ii) the amount of each payment required pursuant to Section 4.15
shall be payable as provided therein; and
(iii) all outstanding Loans shall be payable on the Maturity Date.
(e) All or any portion of the aggregate amount of all Loans at any time
outstanding may, at any time and from time to time, be paid or prepaid in
whole or in part, provided that (i) any partial prepayment shall be an
integral multiple of $1,000,000, (ii) any partial prepayment shall be in an
amount not less than $5,000,000, (iii) any payment or prepayment of all or any
part of any Eurodollar Borrowing on a day other than the last day of the
applicable Interest Period shall be made on a Business Day, as applicable, and
shall be preceded by at least three (3) Business Days written notice to
Administrative Agent of the date and amount of such payment or payments, and
(iv) any prepayment of a Eurodollar Borrowing prior to the last day of the
applicable Interest Period shall be accompanied by a prepayment fee calculated
in accordance with Section 4.1(f) and any other amounts required to be paid
pursuant to Section 4.8. In addition, if at any time the amount of any
Eurodollar Borrowing is reduced (by payment, prepayment or conversion of a
part thereof) to an amount less than $1,500,000, then such Eurodollar
Borrowing shall automatically convert into a Reference Rate Borrowing, and on
and after such date the right of Borrower to continue such Borrowing as a
Eurodollar Borrowing shall terminate.
(f) Prepayment fees shall be calculated as follows:
(i) $100 (for each Lender and for each Eurodollar contract); plus
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(ii) any loss or expense arising from the liquidation or
reemployment of funds obtained by each Lender to maintain its Eurodollar
Borrowings or from fees payable to terminate the deposits from which
such were obtained, which loss or expense shall be calculated in
accordance with Section 4.8.
Each Lender's determination of the amount of any prepayment fee
shall be conclusive in the absence of manifest error.
Nothing contained in this Section 4.1 shall relieve Borrower from
its obligation to make interest payments to Lenders on each Interest
Payment Date (in accordance with the terms and conditions contained
herein) in the event the funds held in the Account are insufficient to
make such interest payments on any such Interest Payment Date.
4.2 Unused Fee. For the period commencing on the date of this Agreement
and ending on the Maturity Date, Borrower shall pay an unused fee each quarter
to Administrative Agent for the account of each Lender in accordance with its
Pro Rata Share, computed on the basis of a year of 360 days and the actual
number of days elapsed, as follows: (a) if the average daily difference,
during the quarter for which the fee is payable, between (i) the Total
Aggregate Commitment and (ii) the total principal balance outstanding on the
Notes plus the L/C Obligations, is greater than or equal to sixty-six and
two-thirds percent (66-2/3%) of the Total Aggregate Commitment, then the
amount of the unused fee payable by Borrower for such quarter shall equal .30%
per annum times the average daily difference during such quarter between (x)
the Total Aggregate Commitment and (y) the total principal balance outstanding
under the Notes plus the L/C Obligations; (b) if the average daily difference,
during the quarter for which the fee is payable, between (i) the Total
Aggregate Commitment and (ii) the total principal balance outstanding on the
Notes plus the L/C Obligations, is equal to or greater than thirty-three and
one-third percent (33-1/3%) but less than sixty-six and two-thirds percent
(66-2/3%) of the Total Aggregate Commitment, then the amount of the unused fee
payable by Borrower for such quarter shall equal .25% per annum times the
average daily difference during such quarter between (x) the Total Aggregate
Commitment and (y) the total principal balance outstanding under the Notes
plus the L/C Obligations; and (c) if the average daily difference, during the
quarter for which the fee is payable, between (i) the Total Aggregate
Commitment and (ii) the total principal balance outstanding on the Notes plus
the L/C Obligations, is less than thirty three and one-third percent (33-1/3%)
of the Total Aggregate Commitment, then the amount of the unused fee payable
by Borrower for such quarter shall equal .20% per annum times the average
daily difference during such quarter between (x) the Total Aggregate
Commitment and (y) the total principal balance outstanding under the Notes
plus the L/C Obligations. (An example of the foregoing calculation of the
unused fee payable each quarter hereunder is set forth on Schedule 4.2.) The
unused fee accrued as of the last day of September, December, March, and June
of each year shall be payable in arrears on the first (1/st/) Business Day of
each January, April, July, and October of each year and on the Maturity Date.
4.3 Commitment Fee. For the period commencing on the date of this
Agreement and ending on the Maturity Date, Borrower shall pay to
Administrative Agent for the account of each Lender a commitment fee, computed
on the basis of a year of 360 days and the actual number of days, equal to the
Applicable Margin applicable to the commitment fee times the amount of the
Commitment of each such Lender; provided that during any Interest Coverage
Failure Period, the
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commitment fee otherwise payable shall be increased by .125% per annum. The
commitment fee owing to each Lender under this Section 4.3 shall (a) be
payable quarterly in arrears on the first (1/st/) Business Day of each
January, April, July, and October of each year and on the Maturity Date, and
(b) accrue whether or not any one or more of the conditions in Section 6.2 is
not met.
4.4 Late Payments. Should any installment of principal or interest or
any fee or cost or other amount payable under any Loan Document to Lenders not
be paid within three (3) Business Days of when due, it shall thereafter bear
interest at a fluctuating interest rate per annum at all times equal to the
sum of the Reference Rate plus the Applicable Margin, if any, applicable to
Reference Rate Borrowings plus two percent (2.0%) per annum, to the fullest
extent permitted by applicable Law. Accrued and unpaid interest on past due
amounts (including, without limitation, interest on past due interest) shall
be compounded monthly, on the last day of each calendar month, to the fullest
extent permitted by applicable Law.
4.5 Taxes.
(a) Any and all payments by Borrower to or for the account of
Administrative Agent or any Lender (including any Lender in its capacity as an
Issuing Bank) under any Loan Document shall be made free and clear of and
without deduction for any and all present or future taxes, duties, levies,
imposts, deductions, assessments, fees, withholdings, or similar charges, and
all liabilities with respect thereto, excluding, in the case of Administrative
Agent or any Lender, taxes imposed on or measured by its overall net income,
and franchise taxes imposed on it (in lieu of net income taxes), by the
jurisdiction (or any political subdivision thereof) under the Laws of which
Administrative Agent or such Lender is organized or maintains a lending office
(all such non-excluded taxes, duties, levies, imposts, deductions,
assessments, fees, withholdings, or similar charges and liabilities being
hereinafter referred to as "Taxes"). If Borrower shall be required by any Laws
to deduct any Taxes from or in respect of any sum payable under any Loan
Document to Administrative Agent or any Lender, then (i) the sum payable shall
be increased as necessary so that after making all required deductions
(including deductions applicable to additional sums payable under this Section
4.5), Administrative Agent and each Lender receives an amount equal to the sum
it would have received had no such deductions been made, (ii) Borrower shall
make such deductions, (iii) Borrower shall pay the full amount deducted to the
relevant taxation authority or other authority in accordance with applicable
Laws, and (iv) within thirty (30) days after the date of such payment,
Borrower shall furnish to Administrative Agent (which shall forward the same
to such Lender, as applicable) the original or a certified copy of a receipt
evidencing payment thereof.
(b) In addition, Borrower agrees to pay any and all present or future
stamp, court, or documentary taxes and any other excise or property taxes or
charges or similar levies which arise from any payment made under any Loan
Document or from the execution, delivery, performance, enforcement, or
registration of, or otherwise with respect to, any Loan Document (hereinafter
referred to as "Other Taxes").
(c) If Borrower shall be required to deduct or pay any Taxes or Other
Taxes from or in respect of any sum payable under any Loan Document to
Administrative Agent or any Lender, then Borrower shall also pay to
Administrative Agent or such Lender, as applicable, at the time interest is
paid, such additional amount that Administrative Agent or such Lender, as
applicable specifies is
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necessary to preserve the after-tax yield (after factoring in all Taxes,
including Taxes imposed on or measured by net income) that Administrative
Agent or such Lender, as applicable would have received if such Taxes or Other
Taxes had not been imposed.
(d) Borrower agrees to indemnify Administrative Agent and each Lender
for (i) the full amount of Taxes and Other Taxes (including any Taxes or Other
Taxes imposed or asserted by any jurisdiction on amounts payable under this
Section 4.5) paid by Administrative Agent or such Lender, as applicable, (ii)
amounts payable under Section 4.5(c), and (iii) any liability (including
additions to Tax, penalties, interest, and expenses) arising therefrom or with
respect thereto, in each case whether or not such Taxes or Other Taxes were
correctly or legally imposed or asserted by the relevant Governmental
Authority. Payment under this Section 4.5(d) shall be made within thirty (30)
days after the date Administrative Agent or any Lender makes a demand
therefor, accompanied by a certificate described in Section 4.11.
(e) Before giving any notice under this Section 4.5, the affected
Lender shall designate a different Lending Office if such designation will
avoid the need for giving such notice or making such demand and will not, in
the judgment of such Lender, be illegal or otherwise disadvantageous to such
Lender.
4.6 Illegality.
(a) If any Lender determines that the introduction of any Law, or any
change in any Law or in the interpretation or administration of any Law, has
made it unlawful, or that any central bank or other Governmental Authority has
asserted that it is unlawful, for any Lender or its applicable Lending Office
to make Eurodollar Borrowings, then, on notice thereof by such Lender to
Borrower through Administrative Agent, any obligation of that Lender to make
Eurodollar Borrowings shall be suspended until such Lender notifies
Administrative Agent and Borrower that the circumstances giving rise to such
determination no longer exist.
(b) If a Lender determines that it is unlawful to maintain any
Eurodollar Borrowing, Borrower shall, upon its receipt of notice of such fact
and demand from such Lender (with a copy to Administrative Agent), prepay in
full such Eurodollar Borrowings of such Lender then outstanding, together with
interest accrued thereon and amounts required under Section 4.8, either on the
last day of the Interest Period thereof, if such Lender may lawfully continue
to maintain such Eurodollar Borrowings to such day, or immediately, if such
Lender may not lawfully continue to maintain such Eurodollar Borrowing. If
Borrower is required to so prepay any Eurodollar Borrowing, then concurrently
with such prepayment, Borrower shall borrow from the affected Lender, in the
amount of such repayment, a Reference Rate Borrowing.
(c) If the obligation of any Lender to make or maintain Eurodollar
Borrowings has been so terminated or suspended, then all Loans which would
otherwise be made by such Lender as Eurodollar Borrowings shall be instead
Reference Rate Borrowings.
(d) Before giving any notice to Administrative Agent under this Section
4.6, the affected Lender shall designate a different Lending Office with
respect to its Reference Rate Borrowings if
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such designation will avoid the need for giving such notice or making such
demand and will not, in the judgment of such Lender, be illegal or otherwise
disadvantageous to such Lender.
4.7 Increased Costs and Reduction of Return.
(a) If any Lender (including any Lender in its capacity as an Issuing
Bank) determines that, due to either (i) the introduction of or any change
(other than any change by way of imposition of or increase in reserve
requirements described in Section 4.10 and other than a change in income tax
rates or the manner of computing income taxes of any Lender) in or in the
interpretation of any law or regulation or (ii) the compliance by that Lender
with any guideline imposed or request made by any central bank or other
Governmental Authority after the date hereof (whether or not having the force
of law), there shall be any increase in the cost to such Lender of agreeing to
make or making, funding, or maintaining any Eurodollar Borrowings or issuing
or participating in Letters of Credit, then if such Lender generally is
assessing such amounts to its borrowers that are similarly situated as
Borrower, Borrower shall be liable for, and shall from time to time, upon five
(5) days prior notice and receipt of a certificate described in Section 4.11
(with a copy of such notice and certificate to be sent to Administrative
Agent), pay to Administrative Agent for the account of such Lender, additional
amounts as are sufficient to compensate such Lender for such increased costs.
(b) If any Lender shall have determined that (i) the introduction of
any Capital Adequacy Regulation, (ii) any change in any Capital Adequacy
Regulation, (iii) any change in the interpretation or administration of any
Capital Adequacy Regulation by any central bank or other Governmental
Authority charged with the interpretation or administration thereof, or (iv)
compliance by such Lender (or its Lending Office) or any corporation
controlling such Lender with any Capital Adequacy Regulation described in
clauses (i) through (iii) above, affects or would affect the amount of capital
required or expected to be maintained by such Lender or any corporation
controlling such Lender and (taking into consideration such Lender's or such
corporation's policies with respect to capital adequacy and such Lender's
desired return on capital) determines that the amount of such capital is
increased as a consequence of its Commitment, Loans, Letters of Credit, or
obligations under this Agreement, then, upon five (5) days prior notice
(accompanied by a certificate described in Section 4.11) of such Lender to
Borrower through Administrative Agent, if such Lender generally is assessing
such amounts to its borrowers that are similarly situated as Borrower,
Borrower shall pay to such Lender, from time to time as specified by such
Lender, additional amounts sufficient to compensate such Lender for such
increase.
(c) Before giving any notice under this Section 4.7, the affected
Lender shall designate a different Lending Office if such designation will
avoid the need for giving such notice or making such demand and will not, in
the judgment of such Lender, be illegal or otherwise disadvantageous to such
Lender.
4.8 Funding Losses. Borrower shall reimburse each Lender and hold each
Lender harmless from any loss or expense (to the extent not duplicative of a
charge imposed and paid under Section 4.1(f)) which such Lender may sustain or
incur as a consequence of:
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(a) the failure of Borrower to borrow, continue, or redesignate a Loan
after Borrower has given (or is deemed to have given) a Request for Borrowing
or a Request for Redesignation of Borrowing; or
(b) any payment (including after acceleration of a Eurodollar
Borrowing) of a Eurodollar Borrowing on a day that is not the last day of the
relevant Interest Period; or
(c) the automatic conversion under Section 4.1(e) of any Eurodollar
Borrowing to a Reference Rate Borrowing on a day that is not the last day of
the relevant Interest Period;
including any such loss or expense arising from the liquidation or
reemployment of funds obtained by it to maintain its Eurodollar Borrowings or
from fees payable to terminate the deposits from which such funds were
obtained (but excluding any loss of anticipated profit).
For purposes of calculating amounts payable by Borrower to Lenders under this
Section 4.8 (and Section 4.1(f) above), each Eurodollar Borrowing (and each
related reserve, special deposit, or similar requirement) shall be
conclusively deemed to have been funded at the Eurodollar Rate by a matching
deposit or other borrowing in the interbank eurodollar market for a comparable
amount and for a comparable period, regardless of whether such Eurodollar
Borrowing is so funded. Any Lender claiming compensation under this Section
4.8 shall provide to Borrower a certificate setting forth in reasonable detail
the amount of loss or expense to be paid to it hereunder, which certificate
shall be conclusive in the absence of manifest error.
4.9 Inability to Determine Rates. If (a) Administrative Agent
determines that for any reason adequate and reasonable means do not exist for
determining the Eurodollar Rate for any requested Interest Period with respect
to a proposed Eurodollar Borrowing, or (b) the Majority Lenders determine that
the Eurodollar Rate applicable pursuant to Section 4.1(c) for any requested
Interest Period with respect to a proposed Eurodollar Borrowing does not
adequately and fairly reflect the cost to such Lenders of funding such
Borrowing, then, in the case of (a), Administrative Agent will promptly so
notify Borrower and each Lender and, in the case of (b) such Lenders will
promptly notify Administrative Agent and Borrower. Thereafter, the obligation
of Lenders to make or maintain Eurodollar Borrowings, as the case may be,
hereunder shall be suspended until Administrative Agent (in the case of (a))
revokes or Administrative Agent upon the instruction of the Majority Lenders
(in the case of (b)) revokes such notice in writing. Upon receipt of such
notice, Borrower may revoke any Request for Borrowing or Request for
Redesignation of Borrowing then submitted by it. If Borrower does not revoke
such Request, then Lenders shall make, convert, or continue the Loans, as
proposed by Borrower, in the amount specified in the applicable notice
submitted by Borrower, but such Loans shall be made, converted, or continued
as Reference Rate Borrowings instead of Eurodollar Borrowings. As of the date
of this Agreement, neither Administrative Agent nor any Lender has made the
determination or is aware of the conditions referenced in the first sentence
of this Section 4.9.
4.10 Reserves on Eurodollar Borrowings. Borrower shall pay to each
Lender, as long as such Lender shall be required under regulations of the FRB
to maintain reserves with respect to liabilities or assets consisting of or
including Eurocurrency funds or deposits (currently known as "Eurocurrency
liabilities"), additional interest or other costs on the unpaid principal
amount of each Eurodollar Borrowing equal to the actual costs of such reserves
allocated to such Loan by such Lender
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(as determined by such Lender in good faith, which determination shall be
conclusive), which shall be due and payable on each date on which interest is
payable on such Loan, provided Borrower shall have received at least fifteen
(15) days' prior written notice (with a copy to Administrative Agent) of such
additional interest from such Lender. If a Lender fails to give notice fifteen
(15) days prior to the relevant Interest Payment Date, such additional
interest shall be payable fifteen (15) days from receipt of such notice.
4.11 Certificates of Lenders. Any Lender claiming reimbursement or
compensation under this Article 4 shall deliver to Borrower (with a copy to
Administrative Agent) a certificate setting forth in reasonable detail the
amount payable to such Lender hereunder and such certificate shall be
conclusive and binding on Borrower in the absence of manifest error.
4.12 Substitution of Lenders. Upon the receipt by Borrower from any
Lender (an "Affected Lender") of a claim for compensation under Section 4.5,
Section 4.7, or Section 4.10 or, to the extent such problem affects less than
the Majority Lenders, notice of a Lender's inability to fund Eurodollar
Borrowings under Section 4.6, Borrower may, upon notice to such Lender and
Administrative Agent, replace such Lender by causing such Lender to assign its
Commitment (with the assignment fee to be paid by Borrower in such instance)
pursuant to Section 11.6(b) to one or more other Lenders or Eligible Assignees
procured by Borrower. Borrower shall (a) pay (or cause to be paid) in full all
principal, interest, fees, and other amounts owing to such Lender through the
date of replacement (including any amounts payable pursuant to Section 4.5,
Section 4.7, Section 4.8, and Section 4.10), and (b) release such Lender from
its obligations under the Loan Documents. Any Lender being replaced shall
execute and deliver an Assignment and Assumption with respect to such Lender's
Commitment and outstanding Loans and participations in L/C Obligations.
4.13 Survival. The agreements and obligations of Borrower in Sections
4.5, 4.7, 4.8, and 4.10 shall survive for one (1) year following termination
of the Total Aggregate Commitment and the payment in full of all Obligations.
4.14 Manner and Treatment of Payments. The amount of each payment
hereunder or on each Note shall be made without condition or deduction for any
counterclaim, defense, recoupment, or setoff to Administrative Agent for the
account of each applicable Lender in immediately available funds on the day of
payment (which must be a Business Day). Any payment received after 1:00 p.m.
on any Business Day, shall be deemed received on the next succeeding Business
Day. The amount of all payments received by Administrative Agent for the
account of each Lender shall be promptly paid by Administrative Agent to the
applicable Lender(s) in immediately available funds (and any such payment not
remitted on the same Business Day that it is deemed received by Administrative
Agent shall thereafter be payable by Administrative Agent to the applicable
Lender(s) together with interest at the overnight Federal Funds Rate, as such
rate is reasonably determined by Administrative Agent). Whenever any payment
to be made hereunder or on each Note is due on a day that is not a Business
Day, payment shall be made on the next succeeding Business Day; provided that
the extension shall be included in the computation of interest owing on the
next following Interest Payment Date. Any payment of the principal of any
Eurodollar Borrowing shall be made on a Business Day as applicable.
4.15 Mandatory Prepayment. In the event that the aggregate principal
amount of the outstanding Loans plus the L/C Obligations at any time exceeds
the limitations specified in
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Section 3.6 (whether because of the outstanding amount of the Loans or L/C
Obligations, or because of the other outstanding Senior Unsecured Home
Building Debt), Borrower shall, within two (2) Business Days, make a
prepayment of the Loans in such amount as is necessary to cause the amount of
outstanding Loans plus L/C Obligations to comply with the limitations of
Section 3.6. In the event that, after any prepayment pursuant to the
immediately preceding sentence, the L/C Obligations exceed the Borrowing Base,
Borrower shall, within two (2) Business Days, upon demand by Administrative
Agent deposit with Administrative Agent, for the benefit of Lenders, an amount
in cash equal to the amount by which the outstanding L/C Obligations exceed
the Borrowing Base. Such cash shall be deposited in an interest bearing
account with Administrative Agent as to which Borrower shall have no right of
withdrawal except as provided below. At such time as the Borrowing Base once
again equals or exceeds the outstanding Loans and L/C Obligations, and
provided no other Default or Event of Default exists, the amount so deposited
by Borrower in such restricted account with Administrative Agent, together
with any interest accrued thereon, shall be remitted to Borrower.
4.16 Other Fees. Borrower shall pay to Administrative Agent, for its
account and the account of Arranger and Lenders, the fees in the amounts and
at the times specified in the Fee Letter. Such fees shall be fully earned when
paid and shall not be refundable for any reason whatsoever.
4.17 Maturity Date Extension Option. So long as no Default or Event of
Default exists at the time of extension or would result therefrom, the
Maturity Date may be extended to October 31, 2006, at request of Borrower,
upon receipt by Administrative Agent, not earlier than three hundred
sixty-five (365) days and not later than ninety (90) days prior to the
then-existing Maturity Date, of (a) a written request from Borrower to extend
the Maturity Date, and (b) payment of an extension fee, for the account of
each Lender in accordance with its Pro Rata Share, in an amount equal to .25%
times the Total Aggregate Commitment.
4.18 Voluntary Prepayment and Termination of Credit Facility Upon Change
of Control. Upon any Change of Control, Borrower may terminate, upon written
notice to Administrative Agent, this Agreement and the credit facility
hereunder, provided that at the time of such Change in Control, Borrower shall
have (a) repaid the outstanding Loans in full, and otherwise paid and
performed all other outstanding Obligations, and (b) cash collateralized all
outstanding L/C Obligations and any payment or reimbursement obligations of
Borrower and any Letter of Credit Subsidiaries in the manner specified in the
last full paragraph of Section 9.2; and, notwithstanding any termination of
this Agreement or the credit facility hereunder, Borrower and any Letter of
Credit Subsidiaries or any other Persons in any way liable or responsible for
the repayment of the L/C Obligations shall continue to be liable and
responsible therefor, and the Issuing Banks, Administrative Agent, Lenders,
and any other obligees with respect thereto shall continue to retain all of
their repayment rights and other rights with respect thereto, including those
specified in such last full paragraph of Section 9.2.
4.19 Optional Commitment Reduction and Termination. Borrower may, upon
notice to Administrative Agent, from time to time permanently reduce the Total
Aggregate Commitment; provided that (a) any such partial reduction shall be in
the amount of $10,000,000 or any greater integral multiple of $1,000,000, (ii)
Borrower shall not terminate or reduce the Total Aggregate Commitment if,
after giving effect thereto and to any concurrent prepayments hereunder, the
aggregate principal amount of the outstanding Loans plus the L/C Obligations
would exceed the Total Aggregate Commitment; provided, further, that the Total
Aggregate Commitment may be terminated if, at the
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time of such termination Borrower shall have (a) repaid the outstanding Loans
in full, and otherwise paid and performed all other outstanding Obligations,
and (b) cash collateralized all outstanding L/C Obligations and any payment or
reimbursement obligations of Borrower and any Letter of Credit Subsidiaries in
the manner specified in the last full paragraph of Section 9.2; and,
notwithstanding any termination of this Agreement or the credit facility
hereunder, Borrower and any Letter of Credit Subsidiaries or any other Persons
in any way liable or responsible for the repayment of the L/C Obligations
continue to be liable and responsible therefor, and the Issuing Banks,
Administrative Agent, Lenders, and any other obligees with respect thereto
continue to retain all of their repayment rights and other rights with respect
thereto, including those specified in such last full paragraph of Section 9.2.
Administrative Agent will promptly notify Lenders of any such notice of
termination or reduction of the Total Aggregate Commitment. Any reduction of
the Total Aggregate Commitment shall be applied to the Commitment of each
Lender according to its Pro Rata Share.
ARTICLE 5: SECURITY. Except for cash collateral with respect to the L/C
Obligations that may be required under certain circumstances as provided in
Section 4.15, Section 4.18, Section 4.19, Section 9.2, or as otherwise
expressly provided herein, the Obligations shall be unsecured.
ARTICLE 6: CONDITIONS.
6.1 Conditions to Disbursement of First Borrowings. The effectiveness
of this Agreement and the obligation of Lenders to make the first disbursement
of Loans are expressly conditioned upon satisfaction of all of the following
conditions precedent:
(a) Administrative Agent shall have received the following original
executed documents (in form and substance reasonably satisfactory to
Administrative Agent and legal counsel for Administrative Agent and in
sufficient number for Administrative Agent and each Lender):
(i) this Agreement;
(ii) each Note;
(iii) the Guaranty, the Guaranty of the Subsidiary Letters of
Credit, and the Contribution Agreement;
(iv) the Opinion of Counsel;
(v) a certified copy of resolutions of the board of directors of
Borrower authorizing the execution of the Loan Documents, together with
an incumbency certificate executed by the corporate secretary of
Borrower;
(vi) a certified copy of resolutions of the board of directors of
each Guarantor authorizing the execution of the Guaranty, together with
an incumbency certificate executed by the corporate secretary of each
Guarantor;
(vii) a Borrowing Base Certificate calculated as of September 30,
2002, showing Borrower to be in compliance with Sections 3.6 and 8.18;
and
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(viii) such other agreements, instruments, and documents as any
Lender shall reasonably request.
(b) Administrative Agent shall have received evidence reasonably
satisfactory to Administrative Agent and legal counsel to Administrative Agent
that each of Borrower and each Guarantor has been duly incorporated, or
formed, as the case may be, is validly existing, and is in good standing under
the laws of the state of its incorporation or formation, as the case may be,
is duly qualified to do business as, and is in good standing as, a foreign
corporation in each jurisdiction in which the conduct of its business or the
ownership or leasing of its properties makes such qualification necessary
(except where the failure to be so qualified could not reasonably be expected
to have a Material Adverse Effect), and has all requisite power and authority
to conduct its business and to own and lease its properties.
(c) The Existing Agreement shall have been terminated by written notice
from Borrower to Administrative Agent. Each of the Lenders hereunder that is a
Lender under the Existing Agreement hereby waives any requirement set forth in
the Existing Agreement that Borrower provide notice prior to prepayment of the
Loans thereunder and consents to the termination of all "Commitments" under
the Existing Agreement. The waiver set forth herein is limited as provided
herein and shall not be deemed to be a waiver or consent to any deviation from
the terms of this Agreement or the other Loan Documents.
6.2 Conditions for Subsequent Borrowings. The obligation of Lenders to
make any Borrowing (including the first and any subsequent Borrowing) is
subject to the following conditions precedent:
(a) the representations and warranties contained in Article 7 shall be
correct in all material respects on and as of the date of the Borrowing, as
though made on and as of that date, and no Default or Event of Default shall
have occurred and be continuing or result from such Borrowing; and
(b) Borrower shall, at its sole expense, deliver or cause to be
delivered to Administrative Agent, in form and substance reasonably
satisfactory to Administrative Agent, a Request for Borrowing.
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ARTICLE 7: REPRESENTATIONS AND WARRANTIES OF BORROWER.
Borrower represents and warrants to each Lender that:
7.1 Incorporation, Qualification, Powers, and Capital Stock. Borrower
is a corporation duly incorporated, validly existing, and in good standing
under the laws of the state of Delaware, is duly qualified to do business as,
and is in good standing as, a foreign corporation in each jurisdiction in
which the conduct of its business or the ownership or leasing of its
properties makes such qualification necessary, and has all requisite power and
authority to conduct its business and to own and lease its properties (except
where the failure to be so qualified could not reasonably be expected to have
a Material Adverse Effect). All outstanding shares of capital stock of
Borrower are duly authorized, validly issued, fully paid, nonassessable, and
issued in compliance with all applicable state and federal securities and
other Laws except where the failure to comply could not reasonably be expected
to have a Material Adverse Effect.
7.2 Execution, Delivery, and Performance of Loan Documents.
(a) Borrower has all requisite power and authority to execute and
deliver, and to perform all of its obligations under, the Loan Documents.
(b) Each Guarantor has all requisite power and authority to execute and
deliver, and to perform all of its obligations under, the Guaranty.
(c) The execution and delivery by Borrower of, and the performance by
Borrower of each of its obligations under, each Loan Document to which it is a
party, and the execution and delivery by each Guarantor of, and the
performance by each Guarantor of each of its obligations under the Guaranty,
have been duly authorized by all necessary action and do not and will not:
(i) require any consent or approval not heretofore obtained of
any stockholder, security holder or creditor of Borrower, any
Subsidiary, or any Guarantor;
(ii) violate any provision of the certificate of incorporation or
bylaws of Borrower or any Guarantor or any provision of the articles or
certificate of incorporation, bylaws, or partnership agreement of any
Subsidiary;
(iii) result in or require the creation or imposition of any lien,
claim, or encumbrance (except to the extent that any lien is created
under this Agreement) upon or with respect to any property now owned or
leased or hereafter acquired by Borrower, any Subsidiary, or any
Guarantor;
(iv) violate any provision of any Law, order, writ, judgment,
injunction, decree, determination, or award presently in effect having
applicability to Borrower, any Subsidiary, or any Guarantor; or
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(v) result in a breach of or constitute a default under, or
cause or permit the acceleration of any obligation owed under, any
indenture or loan or credit agreement or any other material agreement,
lease, or instrument to which Borrower, any Subsidiary, or any Guarantor
is a party or by which Borrower, any Subsidiary, or any Guarantor or any
property of Borrower, any Subsidiary, or any Guarantor is bound or
affected.
(d) Borrower, each Subsidiary, and each Guarantor are not in default
under any Law, order, writ, judgment, injunction, decree, determination,
award, indenture, agreement, lease, or instrument described in Sections
7.2(c)(iv) or 7.2(c)(v), where such default could reasonably be expected to
have a Material Adverse Effect.
(e) No authorization, consent, approval, order, license, permit, or
exemption from, or filing, registration, or qualification with, any
Governmental Authority not heretofore obtained is or will be required under
applicable Law to authorize or permit the execution, delivery, and performance
by Borrower or any Guarantor of, all of its obligations under, the Loan
Documents.
(f) Each of the Loan Documents to which Borrower is a party, when
executed and delivered, will constitute the legal, valid, and binding
obligations of Borrower, and the Guaranty, when executed and delivered, will
constitute the legal, valid, and binding obligation of each Guarantor, each
enforceable against such Person in accordance with its terms, except as
enforcement may be limited by Debtor Relief Laws or equitable principles
relating to the granting of specific performance or other equitable remedies
as a matter of judicial discretion.
7.3 Compliance with Laws and Other Requirements. Borrower is in
compliance with all Laws and other requirements applicable to its business and
has obtained all Material authorizations, consents, approvals, orders,
licenses, permits, and exemptions from, and has accomplished all filings,
registrations, or qualifications with, any Governmental Authority that is
necessary for the transaction of its business, in each case except where the
failure to do so could not reasonably be expected to have a Material Adverse
Effect and except for consents, approvals, orders, licenses, permits, and
exemptions relating to the development, construction, and sale of real
property that Borrower is in the process of obtaining or intends to obtain in
the ordinary course of business.
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7.4 Subsidiaries.
(a) Exhibit J correctly sets forth, as of the last day of the most
recent fiscal quarter of Borrower, the names and jurisdictions of
incorporation or formation of all Subsidiaries, Homebuilding Joint Ventures,
and other entities in which Borrower has a direct or indirect ownership
interest (but excluding publicly-traded Persons in which Borrower, directly or
indirectly, holds less than a five percent (5%) ownership interest). Except as
described in Exhibit J, as of the end of the most recent fiscal quarter of
Borrower, excluding publicly-traded Persons in which Borrower, directly or
indirectly, holds less than a five percent (5%) ownership interest, Borrower
does not own any capital stock or ownership interest in any Person other than
its Subsidiaries and Homebuilding Joint Ventures. All outstanding shares of
capital stock or ownership interests, as the case may be, of each Subsidiary
and Homebuilding Joint Venture that are owned by Borrower or any Subsidiary
are (i) owned of record and beneficially by Borrower and/or by one (1) or more
Subsidiaries, free and clear of all material liens, claims, encumbrances, and
rights of others, and are (ii) duly authorized, validly issued, fully paid,
nonassessable (except for capital calls or contribution requirements in
connection with ownership interests in Homebuilding Joint Ventures), and
issued in compliance with all applicable state and federal securities and
other Laws, except where the failure to comply could not reasonably be
expected to have a Material Adverse Effect. Borrower may update Exhibit J from
time to time by sending written notice to Administrative Agent.
(b) Each Subsidiary is a corporation, partnership, or limited liability
company duly incorporated or formed, validly existing, and in good standing
under the laws of its respective jurisdiction of incorporation or formation,
is duly qualified to do business as, and is in good standing as, a foreign
corporation, partnership, or limited liability company in each jurisdiction in
which the conduct of its business or the ownership or leasing of its
properties makes such qualification necessary (except where the failure to be
so qualified could not reasonably be expected to have a Material Adverse
Effect), and has all requisite power and authority to conduct its business and
to own and lease its properties.
(c) Each Subsidiary is in compliance with all Laws and other
requirements applicable to its business and has obtained all authorizations,
consents, approvals, orders, licenses, permits, and exemptions from, and has
accomplished all filings, registrations, or qualifications with, any
Governmental Authority that is necessary for the transaction of its business,
in each case except where the failure to do so could not reasonably be
expected to have a Material Adverse Effect and except for consents, approvals,
orders, licenses, permits, and exemptions relating to the development,
construction, and sale of real property that each such Subsidiary is in the
process of obtaining or intends to obtain in the ordinary course of business.
7.5 Financial Statements of Borrower and its Subsidiaries. Borrower has
furnished to Lenders that are parties to this Agreement on the Closing Date a
copy of the Form 10-K of Borrower and its Subsidiaries as of December 31,
2001, and a copy of the Form 10-Q of Borrower and its Subsidiaries dated as of
September 30, 2002, (and with respect to the September 30, 2002 Form 10-Q the
other information required by Section 8.1(b) was also furnished to Lenders).
The financial statements and the notes thereto included in such Form 10-K and
such Form 10-Q fairly present in all material respects the consolidated
financial position of Borrower and its Subsidiaries as at the dates
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specified therein and the consolidated results of operations and cash flows
for the periods then ended, all in conformity with GAAP.
7.6 No Material Adverse Change. There has been no material adverse
change in the condition, financial or otherwise, of Borrower and its
Subsidiaries, taken as a whole, from the financial condition of Borrower and
its Subsidiaries, taken as a whole, since September 30, 2002, and Borrower and
its Subsidiaries, taken as a whole, do not have any material liability
incurred outside of the ordinary course of business or, to the best knowledge
of Borrower, material contingent liability, not reflected or disclosed in the
financial statements or notes thereto described in Section 7.5 (or, to the
extent that financial statements have been delivered pursuant to Section 8.1,
in the most recently delivered financial statements), or otherwise disclosed
to Administrative Agent in writing.
7.7 Tax Liability. Borrower and each Subsidiary have filed all tax
returns (federal, state, and local) required to be filed by them and have paid
all material taxes shown thereon to be due and all property taxes due,
including interest and penalties, if any. To the best knowledge of Borrower,
there does not exist any substantial likelihood that any Governmental
Authority will successfully assert a tax deficiency against Borrower or any
Subsidiary that could reasonably be expected to have a Material Adverse Effect
that has not been adequately reserved against in the financial statements
described in Section 7.5 (or, to the extent that financial statements have
been delivered pursuant to Section 8.1, in the most recently delivered
financial statements). Borrower and each Subsidiary have established and are
maintaining adequate reserves for tax liabilities, if any, sufficient to
comply with GAAP.
7.8 Litigation. There are no actions, suits, proceedings, claims, or
disputes pending or, to the best knowledge of Borrower, threatened against
Borrower or any Subsidiary, or any property of Borrower or any Subsidiary,
before any Governmental Authority which could reasonably be expected to have a
Material Adverse Effect.
7.9 Pension Plan. Neither Borrower nor any Subsidiary maintains or
contributes to any Plan (other than (a) the 401(k) plans presently sponsored
by Borrower as to which Borrower has complied with all applicable Laws (except
where the failure to comply could not reasonably be expected to have a
Material Adverse Effect), and (b) Plans of any Persons formed or acquired by
Borrower or any Subsidiary as permitted under Section 8.14 or 8.20).
7.10 Regulations U and X; Investment Company Act. Neither Borrower nor
any Subsidiary is engaged principally, or as one of its important activities,
in the business of extending credit for the purpose of "purchasing" or
"carrying" any "margin stock" within the meanings of Regulation U of the FRB.
No part of the Loans will be used to purchase or carry any margin stock
(except for purchases of Borrower's stock by, or on behalf of, Borrower
otherwise permitted hereunder and that is subsequently retired or retained by
Borrower as treasury stock), or to extend credit to others for that purpose,
or for any purpose that violates the provisions of Regulations U or X of the
FRB. Neither Borrower nor any Subsidiary is or is required to be registered
under the Investment Company Act of 1940.
7.11 No Default. No event has occurred and is continuing that is a
Default or an Event of Default.
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7.12 Environmental Compliance. In connection with the acquisition of
properties, Borrower and its Subsidiaries generally conduct in the ordinary
course of business a review of the environmental condition of such properties
and any claims alleging potential liability or responsibility for violation of
Environmental Laws. In the course of the operation of its business, nothing
has come to the attention of Borrower or any of its Subsidiaries causing it to
conclude that there are any violations of Environmental Laws or claims
alleging potential liability or responsibility for violation of Environmental
Laws that could reasonably be expected to have a Material Adverse Effect.
7.13 Solvent. Borrower and its Subsidiaries are, on a consolidated
basis, Solvent.
7.14 Senior Debt. All obligations under this Agreement and the other
Loan Documents to pay principal, interest, fees, and other amounts included in
the Obligations are senior debt under the terms of all Subordinated Debt of
Borrower and its Subsidiaries.
ARTICLE 8: COVENANTS OF BORROWER.
As long as any Note remains unpaid or any other Obligations remain
outstanding or any Commitment remains in effect:
8.1 Reporting Requirements. Borrower shall cause to be delivered to
Administrative Agent, in form and detail satisfactory to Administrative Agent
(for prompt distribution by Administrative Agent to Lenders):
(a) as soon as practicable and in any event within fifteen (15) days
after the occurrence of a Default or an Event of Default becomes known to
Borrower, a written statement setting forth the nature of the Default or Event
of Default and the action that Borrower proposes to take with respect thereto;
(b) as soon as available and in any event within forty-five (45) days
after the end of each of the first three (3) quarters of each calendar year, a
Form 10-Q of Borrower and its Subsidiaries as of the end of the quarter most
recently ended, and unaudited consolidated balance sheets, statements of
income, stockholders equity, and cash flows of Borrower and unaudited
consolidating balance sheets and statements of income of its Subsidiaries in
the form previously delivered to and approved by Administrative Agent, for
such period, all in reasonable detail and duly certified (subject to year-end
audit adjustments) by the chief financial officer, corporate controller, or
treasurer of Borrower;
(c) as soon as available and in any event within ninety (90) days after
the end of each calendar year, a Form 10-K and a consolidating (unaudited) and
consolidated balance sheet of Borrower and its Subsidiaries as of the end of
the year most recently ended and consolidated statements of income,
stockholders equity, and cash flows of Borrower and its Subsidiaries for such
year, setting forth in each case in comparative form the corresponding figures
for the preceding fiscal year, such financial statements to be audited by and
with the opinion of Ernst & Young LLP (or its successors), KPMG (or its
successors), Price Waterhouse Coopers (or its successors), Deloitte & Touche
(or its successors), or any other independent certified public accountants of
recognized standing selected by Borrower and reasonably acceptable to
Administrative Agent, which opinion
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shall be unqualified except as to such matters as are acceptable to the
Majority Lenders ("Acceptable Audit Opinion");
(d) as soon as available and in any event within ninety (90) days after
the end of each such Guarantor's fiscal year, unaudited balance sheets and
statements of income of such Guarantor, all in reasonable detail and duly
certified by the chief financial officer, corporate controller, or treasurer
of Borrower;
(e) at the time of the delivery of the financial statements described
in Sections 8.1(b), (c), and (d), a certificate of the chief financial
officer, corporate controller, or the treasurer of Borrower (i) stating that
to the knowledge of such officer no Default or Event of Default exists, or if
such an event exists, stating the nature thereof and the action that Borrower
proposes to take with respect thereto, and (ii) demonstrating in reasonable
detail that Borrower was in compliance during the applicable period with the
covenants set forth in Sections 8.15, 8.17, 8.18, 8.19, 8.20, and 8.21,
(including a reconciliation of the amounts used to calculate the covenants
pursuant to Sections 8.19, 8.20, and 8.21 to such financial statements);
(f) as soon as available and in any event within forty-five (45) days
after the end of each calendar year, a projected operating budget of Borrower
for the succeeding twelve (12) months (which for 2002 will be in the form
previously delivered to Administrative Agent); and including for each of
Borrower's real estate development projects for each quarter (i) the number of
projected closings of Units, and (ii) projected revenue (including the
aggregate of all amounts projected to be generated from any source in
connection with the sale of Units to the public);
(g) promptly upon Borrower learning thereof, notice in writing of any
action, suit, or proceeding before any Governmental Authority which could
reasonably be expected to have a Material Adverse Effect;
(h) such other information about the business, assets, operation, or
condition, financial or otherwise, of Borrower or any Subsidiary, as any
Lender (through Administrative Agent) may reasonably request from time to
time;
(i) as soon as available and in any event within forty-five (45) days
after the end of each calendar quarter, a residential development summary
substantially in the form previously submitted to Administrative Agent;
(j) as soon as practicable, and in any event within forty-five (45)
days after the end of each calendar quarter, monthly projections for the next
succeeding twelve (12) month period of cash flow for Borrower (except for the
March 31 reporting which may be for the next succeeding nine (9) months), in
the form previously delivered to each Lender; and
(k) as soon as practicable, and in any event within forty-five (45)
days after the end of each calendar quarter, reports showing the actual
operating results for the calendar quarter most recently ended compared to the
budget provided in accordance with Section 8.1(f).
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8.2 Payment of Taxes and Other Potential Liens. Borrower shall pay and
discharge promptly, and cause each Subsidiary (other than Homebuilding Joint
Ventures) to pay and discharge promptly, all material taxes, assessments, and
governmental charges or levies imposed upon it, upon its property or any part
thereof, upon its income or profits or any part thereof, except that neither
Borrower nor any Subsidiary shall be required to pay or cause to be paid any
tax, assessment, charge, or levy that is not yet past due, or being actively
contested in good faith by appropriate proceedings, as long as Borrower or
Subsidiary, as the case may be, has established and maintains adequate
reserves for the payment of the same and, by reason of nonpayment, no material
property of Borrower or any Subsidiary is in danger of being lost or
forfeited.
8.3 Preservation of Existence. Except where the failure to do so could
not reasonably be expected to have a Material Adverse Effect, Borrower shall
preserve and maintain, and cause each Subsidiary to preserve and maintain, its
corporate, partnership, or limited liability company existence, as the case
may be, and all licenses, rights, franchises, and privileges in the
jurisdiction of its incorporation or formation and all authorizations,
consents, approvals, orders, licenses, permits, or exemptions from, or
registrations or qualifications with, any Governmental Authority that are
necessary for the transaction of its business, and qualify and remain
qualified, and cause each Subsidiary to qualify and remain qualified, to do
business as a foreign corporation or partnership in each jurisdiction in which
such qualification is necessary in view of its business or the ownership or
leasing of its properties; provided that Borrower may, so long as no Default
or Event of Default exists or would result therefrom, dissolve, liquidate, or
merge out of existence any Subsidiary.
8.4 Maintenance of Properties. Except as permitted by Section 8.16,
Borrower shall maintain, preserve, and protect, and cause each Subsidiary to
maintain, preserve, and protect, all of its properties in good order and
condition, subject to wear and tear in the ordinary course of business and, in
the case of unimproved properties, damage caused by the natural elements, and
not permit any Subsidiary to permit, any waste of its properties, except that
neither (a) the failure to maintain, preserve and protect a particular item of
property that could not reasonably be expected to have a Material Adverse
Effect, nor (b) the failure to maintain, preserve, and protect a particular
item of property due to full compliance with a final written order from a
Governmental Authority, will constitute a violation of this Section 8.4.
8.5 Maintenance of Insurance. Borrower shall maintain, and cause each
Subsidiary to maintain: (a) insurance with responsible companies in such
amounts and against such risks as is usually carried by companies engaged in
similar businesses and owning similar properties in the same general area in
which Borrower or any Subsidiary operates (provided that Borrower and its
Subsidiaries may choose to establish a self-insurance program consistent with
self-insurance programs maintained by companies in similar businesses and
owning similar properties); and (b) insurance required by any Governmental
Authority having jurisdiction over Borrower or any Subsidiary.
8.6 Books and Records. Borrower shall maintain, and cause each
Subsidiary to maintain, full and complete books of account and other records
reflecting the results of its operations in conformity with GAAP and all
applicable requirements of any Governmental Authority having jurisdiction over
Borrower or any Subsidiary or any business or properties of Borrower or any
Subsidiary.
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8.7 Inspection Rights. At any time during regular business hours, and
as often as reasonably requested, and so long as no Event of Default exists,
upon reasonable notice, Borrower shall permit, and cause each Subsidiary to
permit, Administrative Agent and each Lender or any employee, agent, or
representative thereof to inspect and make copies and abstracts from the
records and books of account of, and to visit and inspect the properties of,
Borrower and any Subsidiary, and to discuss any affairs, finances, and
accounts of Borrower and any Subsidiary with any of their respective officers
or directors.
8.8 Compliance with Laws and Other Requirements.
(a) Borrower shall comply, and cause each Subsidiary to comply, with
the requirements of all applicable Laws and orders of any Governmental
Authority, noncompliance with which could reasonably be expected to have a
Material Adverse Effect.
(b) Borrower shall comply, and cause each Subsidiary (to the extent
they are so engaged) to comply, with all applicable Laws and other
requirements relating to the development of each of its projects and the sale
of units therein (where the failure to so comply could reasonably be expected
to have a Material Adverse Effect), and shall obtain, and cause each
Subsidiary (to the extent they are so engaged) to obtain, all necessary
authorizations, consents, approvals, licenses, and permits of any Governmental
Authority with respect thereto (except where the failure to so obtain could
not reasonably be expected to have a Material Adverse Effect).
8.9 Subsidiary Guaranties. Borrower shall cause each Material
Subsidiary that does not provide a Guaranty hereunder on the Closing Date to
provide a Guaranty hereunder and such other documentation required by
Administrative Agent, all in form and substance acceptable to Administrative
Agent within thirty (30) days after the date on which such Subsidiary
qualifies as a Material Subsidiary; provided that if any Subsidiary that
provides or has provided a Guaranty hereunder ceases, at any time, to qualify
as a Material Subsidiary, then, upon the request of Borrower, Administrative
Agent shall, so long as no Default or Event of Default exists or would result
therefrom, release such Subsidiary from its Guaranty pursuant to a release in
form and substance reasonably acceptable to Administrative Agent and Borrower.
Notwithstanding the forgoing, if, as of the date of acquisition, formation, or
creation otherwise permitted hereunder of a new Subsidiary that is not a
Material Subsidiary, the aggregate amount of assets (other than ownership
interests in, and intercompany indebtedness of, other Subsidiaries) owned by
all Subsidiaries that are not Material Subsidiaries exceeds three percent (3%)
of Consolidated Tangible Net Worth, then Borrower shall cause such Subsidiary
(whether or not it is a Material Subsidiary) to provide a Guaranty under this
Section 8.9.
8.10 Mergers. Borrower shall not merge or consolidate, or permit any
Subsidiary to merge or consolidate, with or into any Person, except that (a)
no merger or consolidation in connection with the sale of Standard Pacific
Financing, L.P., or Standard Pacific Financing, Inc. will constitute a
violation of this covenant (provided that the corporate existence of Borrower,
if a party to such merger or consolidation, is continued), (b) any Subsidiary
may merge into Borrower (provided that the surviving entity is Borrower) or
into any other Subsidiary (provided that Borrower complies with Section 8.9),
(c) no merger or consolidation in connection with an acquisition permitted
under Section 8.17 will constitute a violation of this covenant (provided that
the corporate existence of
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Borrower, if a party to such merger or consolidation, is continued), and (d)
no merger or consolidation in connection with a disposition permitted under
Section 8.16 will constitute a violation of this covenant (provided that the
corporate existence of Borrower, if a party to such merger or consolidation,
is continued).
8.11 Liens. Borrower shall not create, incur, assume, or allow to exist,
or permit any Subsidiary to create, incur, assume, or allow to exist, any lien
of any nature upon or with respect to any property of Borrower or any
Subsidiary, whether now owned or hereafter acquired, except the following
permissible liens:
(a) liens securing indebtedness existing on the date hereof and
disclosed in the notes to the financial statements incorporated in the Form
10-K described in Section 7.5, but only to the extent of the indebtedness
secured thereby and the property subject thereto on the date hereof and
renewals, extensions, or refundings thereof that do not increase the principal
amount of indebtedness secured thereby or the property subject thereto;
(b) liens for taxes, assessments, or governmental charges or levies to
the extent that neither Borrower nor any Subsidiary is required to pay the
amount secured thereby under Section 8.2;
(c) liens imposed by Law, such as carrier's, warehouseman's,
mechanic's, materialman's, and other similar liens, arising in the ordinary
course of business in respect of obligations that are not overdue or are being
actively contested in good faith by appropriate proceedings, as long as
Borrower or a Subsidiary, as the case may be, has established and maintains
adequate reserves for the payment of the same and, by reason of nonpayment, no
property of Borrower or any Subsidiary is in danger of being lost or
forfeited;
(d) purchase money liens upon or in any property acquired or held by
Borrower or any Subsidiary in the ordinary course of business, including,
without limitation real property, to secure the purchase price of such
property, or liens upon or in such property to secure indebtedness incurred
solely for the purpose of financing the acquisition of such property;
(e) purchase money liens existing on property at the time of its
acquisition;
(f) leases of Model Units;
(g) liens on property owned by joint ventures or limited liability
companies with respect to which Borrower or any Subsidiary is a partner or in
which Borrower or a Subsidiary has an equity or ownership interest;
(h) liens or assignments by Borrower, Standard Pacific Financing, L.P.
or Standard Pacific Financing, Inc. (or an operating limited partnership
formed to perform the same functions as Standard Pacific Financing, Inc. in
which Borrower will have a 99% interest in allocations of profits, losses,
distributions, and credits) of mortgages made in connection with financing
transactions entered into in the ordinary course of business;
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(i) liens incurred in the ordinary course of business on property or
assets owned by FLS (including, without limitation, under any credit facility
or repurchase agreement funding its obligations) or on the property or assets
of any other Excluded Subsidiary;
(j) liens securing surety bonds entered into in the ordinary course of
business;
(k) liens on deposits (not including real property) securing appeal
bonds obtained by Borrower or a Subsidiary in connection with the appeal of an
adverse judgment;
(l) liens securing community development district bonds or similar
bonds issued by Governmental Authorities to accomplish similar purposes; and
(m) any other liens not otherwise specified in Subsections 8.11(a)
through (l) (except for Judgment Liens and Project Financing Liens, which
shall in no event be permitted), so long as the aggregate amount of
indebtedness secured by all such other liens does not at any time exceed
$35,000,000.
8.12 Prepayment of Indebtedness. If a Default or an Event of Default has
occurred and is continuing or an acceleration of the indebtedness evidenced by
each Note has occurred, Borrower shall not voluntarily prepay, or permit any
Subsidiary to voluntarily prepay, the principal amount, in whole or in part,
of any indebtedness other than (a) indebtedness owed to each Lender hereunder
or under some other agreement between Borrower and such Lender and (b)
indebtedness which ranks pari passu with indebtedness evidenced by each Note
which is or becomes due and owing whether by reason of acceleration or
otherwise.
8.13 Change in Nature of Business. Borrower shall not make, or permit
any Subsidiary to make, any change in the nature of its or their respective
businesses as carried on at the date hereof that is material to Borrower and
Subsidiaries, taken as a whole, which has not been consented to by the
Majority Lenders in writing. None of the following will constitute a violation
of this covenant: (a) the sale or dissolution of Standard Pacific Financing,
L.P. or Standard Pacific Financing, Inc.; (b) the engaging by Borrower or a
Subsidiary in or withdrawal from the mortgage brokering or banking business;
(c) the engaging by Borrower or a Subsidiary in or withdrawal from any
business related to the homebuilding operations of Borrower, such as security
or pest control, and including without limitation technology initiatives
related to Borrower's homebuilding operations; (d) a change in the geographic
regions in the United States of America in which Borrower operates, and (e)
the reorganization of the business of Borrower and its Subsidiaries among
Borrower and its Subsidiaries.
8.14 Pension Plan. Borrower shall not enter into, maintain or make
contributions to, or permit any Subsidiary to enter into, maintain or make
contributions to, directly or indirectly, any Plan that is subject to Title IV
of ERISA, except for defined benefit pension Plans of any Persons formed or
acquired by Borrower or any Subsidiary as permitted under Section 8.17.
8.15 Dividends and Subordinated Debt. Borrower shall not declare or pay
any dividend on, or purchase, redeem, retire, or otherwise acquire for value
any of its capital stock now or hereafter outstanding, return any capital to
its stockholders or make any distribution of assets to its stockholders,
whether in cash, property, or obligations, or pay, repurchase, or redeem all
or any part of any
-▇▇-
▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇, transfer any property in payment of or as security for the
payment of all or any part of any Subordinated Debt, or establish any sinking
fund, reserve, or like set aside of funds or other property for the
redemption, retirement, or repayment of all or any part of any Subordinated
Debt, except:
(a) Subject to the subordination terms applicable to such Subordinated
Debt, Borrower may make regularly scheduled and mandatory payments in respect
of any Subordinated Debt as and when due by the terms thereof; provided,
however, that Borrower may prepay or repurchase Subordinated Debt at any time
from the proceeds of indebtedness issued by Borrower following the Closing
Date so long as (i) the maturity date of all such indebtedness is at least one
(1) year beyond the Maturity Date, and (ii) no Default or Event of Default
exists both before and after giving effect thereto;
(b) So long as no Default or Event of Default exists both before and
after giving effect thereto, Borrower may declare and pay dividends in any
calendar quarter so long as (i) at the time each such dividend is declared the
Consolidated Tangible Net Worth requirement of Section 8.19 remains satisfied
and any such dividend would not cause Section 8.19 to be violated and (ii) all
such dividends paid in such calendar quarter do not in the aggregate exceed
the sum of (A) $3,000,000, plus (B) 50% of the amount by which the cumulative
Consolidated Home Building Net Income (without deduction for net losses) plus
cash distributions from Excluded Subsidiaries for the preceding calendar
quarter exceeds $3,000,000; and
(c) So long as no Default or Event of Default exists both before and
after giving effect thereto, Borrower may from time to time repurchase shares
of its capital stock for an amount not to exceed the lesser of (i)
$100,000,000 in the aggregate for all repurchases after the Closing Date, or
(ii) the amount approved by Borrower's board of directors.
8.16 Disposition of Properties. Borrower shall not, and shall not permit
its Subsidiaries to, sell, assign, exchange, transfer, lease, or otherwise
dispose of any of their respective properties (whether real or personal),
other than:
(a) properties sold, assigned, exchanged, transferred, leased, or
otherwise disposed of for fair value and in the ordinary course of business;
(b) transfers among Borrower and its Subsidiaries or between
Subsidiaries so long as Borrower complies with Section 8.9;
(c) so long as no Default or Event of Default exists before or after
giving effect thereto, the sale, assignment, exchange, transfer, lease or
other disposal for fair value of (i) properties acquired in connection with an
acquisition permitted by Section 8.17 or (ii) properties owned by Borrower or
any Subsidiary that are located in the same geographic market as any part of
the properties acquired in accordance with an acquisition permitted by Section
8.17 and that are being disposed of in good faith as a result of overlap
between existing operations and operations acquired in connection with an
acquisition permitted by Section 8.17; provided, that, Borrower provides
notice to Administrative Agent of its intent to sell, assign, exchange,
transfer, lease or otherwise dispose of such properties within twelve (12)
months of the closing date of the acquisition and the sale, assignment,
exchange,
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transfer, lease or other disposition occurs within twelve (12) months of the
date such notice is provided to Administrative Agent;
(d) any transfer of any or all of the assets, properties, business or
stock of (i) Standard Pacific Financing, L.P. or (ii) Standard Pacific
Financing, Inc.; and
(e) other properties sold, assigned, exchanged, transferred, leased, or
otherwise disposed of for fair value with an aggregate value which does not
exceed $10,000,000 in any one (1) fiscal year.
8.17 Limitation on Investments. Borrower shall not, nor shall it permit
any Subsidiary (other than an Excluded Subsidiary) to, make any Investment or
otherwise acquire any interest in any Person, except:
(a) Investments in Subsidiaries (x) existing on the Closing Date, or
(y) formed or acquired after the Closing Date, in each case so long as
Borrower and such Subsidiary comply with Section 8.9; provided, however:
(i) Borrower shall not enter into any Acquisition:
(A) without the consent of Lenders holding at least fifty-one
percent (51%) of the Total Aggregate Commitment, if the aggregate
consideration paid by Borrower and its Subsidiaries in connection with such
Acquisition exceeds twenty-five percent (25%) of Consolidated Tangible Net
Worth as measured at the time of such Acquisition; or
(B) without the consent of the Majority Lenders, if the aggregate
consideration paid by Borrower and its Subsidiaries in connection with such
Acquisition exceeds thirty-five percent (35%) of Consolidated Tangible Net
Worth as measured at the time of such Acquisition; and
(ii) Borrower shall not make any Investments in any new Non-Wholly Owned
Subsidiaries:
(A) without the consent of Lenders holding at least fifty-one
percent (51%) of the Total Aggregate Commitment, if the aggregate Investment
in each such Non-Wholly-Owned Subsidiary exceeds twenty-five percent (25%) of
Consolidated Tangible Net Worth as measured at the time of formation or
acquisition of such Subsidiary and at the time of any subsequent Investment in
such Subsidiary; and
(B) without the consent of the Majority Lenders, if the aggregate
Investment in each such Non-Wholly Owned Subsidiary exceeds thirty-five
percent (35%) of Consolidated Tangible Net Worth as measured at the time of
formation or acquisition of such Subsidiary and at the time of any subsequent
Investment in such Subsidiary;
(b) Investments in a Home Building Joint Venture, provided that without
the prior written approval of the Majority Lenders, Borrower shall not at any
time permit either:
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(i) the aggregate Investment of Borrower and its Subsidiaries in
a single Home Building Joint Venture to exceed $25,000,000, provided that
Borrower and its Subsidiaries may make up to a $30,000,000 Investment per Home
Building Joint Venture in no more than two (2) single Home Building Joint
Ventures at any time; or
(ii) the aggregate Investment of Borrower and its Subsidiaries in
all Homebuilding Joint Ventures to exceed twenty-five percent (25%) of
Consolidated Tangible Net Worth; provided, however, that for purposes of this
Section 8.17(b), should Borrower incur any non-cash write-down in assets under
FAS 121 (or any successor thereto) or other non-cash decrease in Consolidated
Tangible Net Worth resulting from a change in financial accounting standards,
the amount of such write-down or other decrease (less any subsequent increase
in Consolidated Tangible Net Worth resulting from a change in financial
accounting standards and attributable to the non-cash loss from the date of
the write-down or loss, to the extent positive), will be added back to the
Consolidated Tangible Net Worth attributable to the non-cash loss; provided
further, however, in no event shall the aggregate Investment in all
Homebuilding Joint Ventures exceed thirty percent (30%) of Consolidated
Tangible Net Worth without the foregoing adjustments;
(c) Temporary Cash Investments;
(d) Investments in mortgage banking joint ventures not to exceed
$5,000,000 in the aggregate at any time;
(e) Investments in any other joint ventures engaged in a business
related to the homebuilding operations of Borrower, such as security or pest
control, not to exceed $7,500,000 in the aggregate at any time;
(f) Investments in FLS not to exceed in the aggregate at any time the
greater of (i) $50,000,000 and (ii) ten percent (10%) of Consolidated Tangible
Net Worth;
(g) Investments in any single Person not to exceed $5,000,000 at any
time, provided that the aggregate Investment in all such Persons pursuant to
this clause (g) shall not exceed $10,000,000 at any time; and
(h) Investments in technology related businesses not to exceed
$10,000,000 in the aggregate at any time.
8.18 Senior Unsecured Home Building Debt Not to Exceed Borrowing Base.
Borrower shall not permit the Senior Unsecured Home Building Debt to at any
time exceed the Borrowing Base.
8.19 Consolidated Tangible Net Worth. Borrower shall not permit
Consolidated Tangible Net Worth at any time to be less than the sum of (a)
$527,114,000 plus (b) fifty percent (50%) of the cumulative consolidated net
income (without deduction for losses sustained during any fiscal quarter) of
Borrower and its Subsidiaries for each fiscal quarter subsequent to the fiscal
quarter ended June 30, 2002, plus (c) fifty percent (50%) of the net proceeds
from any equity offerings of Borrower from and after June 30, 2002.
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8.20 Leverage Covenants. Borrower shall not permit at any time any of
the following:
(a) the Total Leverage Ratio to exceed 2.50 to 1.0;
(b) the ratio of Combined Senior Home Building Debt to Adjusted
Consolidated Tangible Net Worth to exceed 2.0 to 1.0;
(c) the ratio of Unsold Land to Adjusted Consolidated Tangible Net
Worth to exceed 1.60 to 1.0.
Furthermore, in the event that the Mandatory Joint Venture Lot Purchase
Obligations at any time exceed $50,000,000, the amount of such Mandatory Joint
Venture Lot Purchase Obligations in excess of $50,000,000 shall be added to
Combined Total Home Building Debt for purposes of calculating the foregoing
leverage covenants set forth in this Section 8.20.
8.21 Minimum Interest Coverage. Borrower shall not permit, at any time,
the ratio (the "Interest Coverage Ratio") of (a) Home Building EBITDA to (b)
Consolidated Home Building Interest Incurred, for any period consisting of the
preceding four (4) consecutive fiscal quarters (each, a "Measurement Period"),
to be less than 1.75 to 1.0; provided, however, that Borrower will not be in
default under this Section 8.21 if the Interest Coverage Ratio is less than
1.75 to 1.0 (but in no event less than 1.25 to 1.0) for not more than two (2)
consecutive Measurement Periods (e.g., the 4-quarter period ending December
31, 2001 and the 4-quarter period ending March 31, 2002) so long as all of the
following conditions are satisfied:
(a) Borrower shall have delivered to Administrative Agent written
notice of its failure to satisfy the 1.75 to 1.0 Interest Coverage Ratio
requirement (an "Interest Coverage Notice"), specifying the Measurement
Period(s) covered thereby (the "Interest Coverage Failure Period"), within
forty-five (45) days after the end of the first such Measurement Period.
(b) Borrower shall have provided Administrative Agent (concurrently
with the delivery of the Interest Coverage Notice) with pro forma financial
statements, in form and detail satisfactory to Administrative Agent,
reflecting that Borrower shall be in compliance with the 1.75 to 1.0 Interest
Coverage Ratio requirement for the four Measurement Periods immediately
succeeding the Interest Coverage Failure Period (or, if the Interest Coverage
Failure Period covers only one (1) Measurement Period, reflecting that
Borrower shall be in compliance for the succeeding four (4) Measurement
Periods or for the four (4) Measurement Periods immediately following the next
succeeding Measurement Period).
(c) Except for the initial Interest Coverage Failure Period, the
Interest Coverage Failure Period covered by any Interest Coverage Notice shall
have been immediately preceded by at least four (4) consecutive Measurement
Periods in which Borrower was in compliance with the 1.75 to 1.0 Interest
Coverage Ratio.
(d) During the Interest Coverage Failure Period (i) if the Interest
Coverage Ratio equals or exceeds 1.50 to 1.0, then the Total Leverage Ratio
shall at no time exceed 1.50 to 1.0, and (ii) if the
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Interest Coverage Ratio is less than 1.50 to 1.0, but greater than or equal to
1.25 to 1.0, then the Total Leverage Ratio shall at no time exceed 1.25 to
1.0.
(e) During the Interest Coverage Failure Period, Borrower shall pay to
Administrative Agent for the account of each Lender the increased commitment
fee pursuant to Section 4.3.
An example of the calculation of the Interest Coverage Ratio is as set forth
in Schedule 8.21.
8.22 Transactions with Affiliates. Borrower shall not, and shall not
permit its Subsidiaries to, enter into any transaction of any kind with any
Affiliate of Borrower, whether or not in the ordinary course of business,
other than on fair and reasonable terms substantially as favorable to Borrower
or such Subsidiary as would be obtainable by Borrower or such Subsidiary at
the time in a comparable arm's length transaction with a Person other than an
Affiliate, provided that the foregoing restriction shall not apply to
transactions between or among Borrower and any of its Subsidiaries or between
and among any Subsidiaries; provided, further, that the foregoing restriction
shall not apply to the payment of compensation or benefits to directors and
executive officers in the ordinary course of business.
ARTICLE 9: EVENTS OF DEFAULT AND REMEDIES UPON DEFAULT.
9.1 Events of Default. The occurrence of any one or more of the
following events shall constitute an Event of Default hereunder:
(a) failure to pay within three (3) Business Days after the date when
due the principal of, or interest on, each Note or any portion thereof; or
(b) failure to pay any fee or any other amount (other than principal or
interest) payable by Borrower or any Subsidiary under the Loan Documents
within fifteen (15) Business Days after the date when due; or
(c) failure of Borrower (and, if applicable, any Subsidiary) to
perform, observe, and comply with:
(i) any applicable covenant or agreement contained in Sections
8.1, 8.9, 8.19, 8.20, and 8.21; or
(ii) Section 8.18 and such failure shall continue unremedied for
three (3) Business Days; or
(iii) any other covenant or agreement contained in any Loan
Document (other than the covenants to pay the Obligations and the
covenants in clauses (i) and (ii) preceding), and such failure continues
unremedied for thirty (30) days after the first to occur of (a) a
Responsible Official of Borrower obtaining actual knowledge of such
failure and that such failure, if not remedied, would constitute an
Event of Default, or (B) Borrower's receipt of notice from
Administrative Agent, of such failure; or
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(d) any representation or warranty in any Loan Document or in any
certificate, agreement, instrument, or other document made or delivered
pursuant to or in connection with any Loan Document proves to have been
incorrect when made in any material respect; or
(e) the occurrence of any default under any other agreement between
Borrower and any Lender, including without limitation, the failure to pay when
due (or within any stated grace period) the principal or any principal
installment of, or any interest, on any present or future indebtedness for
borrowed money owed by Borrower to any Lender; or
(f) Borrower is dissolved or liquidated or all or substantially all of
the assets of Borrower are sold or otherwise transferred or encumbered without
the prior written consent of each Lender; or
(g) Any Subsidiary or any Guarantor is dissolved or liquidated or all
or substantially all of the assets of any Subsidiary or any Guarantor are sold
or otherwise transferred or encumbered without the prior, written consent of
the Majority Lenders, in each case except to the extent permitted by Sections
8.3, 8.10, or 8.16; or
(h) Borrower, any Subsidiary, or any Guarantor is the subject of an
order for relief by any bankruptcy court, or is unable or admits in writing
its inability to pay its debts as they mature or makes an assignment for the
benefit of creditors; or applies for or consents to the appointment of any
receiver, trustee, custodian, conservator, liquidator, rehabilitator, or
similar officer for it or for all or any part of its property; or any
receiver, trustee, custodian, conservator, liquidator, rehabilitator, or
similar officer is appointed without the application or consent of Borrower,
Subsidiary, or Guarantor and the appointment continues undischarged or
unstayed for sixty (60) days; or institutes or consents to any bankruptcy,
insolvency, reorganization, arrangement, readjustment of debt, dissolution,
custodianship, conservatorship, liquidation, rehabilitation, or similar
proceeding relating to it or to all or any part of its property under the laws
of any jurisdiction; or any similar proceeding is instituted without the
consent of Borrower, Subsidiary, or Guarantor, and continues undismissed or
unstayed for forty-five (45) days; or any judgment, writ, warrant of
attachment, or execution or similar process is issued or levied against all or
any part of the property of Borrower, any Subsidiary, or any Guarantor and is
not released, vacated or fully bonded within forty-five (45) days after its
issue or levy; or
(i) the Majority Lenders have reasonably determined that a Material
Adverse Effect has occurred since the date hereof, and fifteen (15) calendar
days have elapsed since the date that notice of such determination is given to
Borrower; or
(j) Borrower, any Subsidiary, or any Guarantor shall (i) fail to pay
any indebtedness (other than Seller Nonrecourse Debt) to any other Person or
any interest or premium thereon, when due (whether by scheduled maturity,
required prepayment, acceleration, demand, or otherwise) and such failure
shall continue after the applicable grace period, if any, specified in the
agreement or instrument relating to such indebtedness, or (ii) fail to perform
any term, covenant, or condition on its part to be performed under any
agreement or instrument relating to any such indebtedness (other than Seller
Nonrecourse Debt), when required to be performed, and such failure shall
continue after the applicable grace period, if any, specified in such
agreement or instrument, if the effect of such failure to perform is to cause,
or to permit the holder or holders of such indebtedness (or a trustee or agent
on behalf of such holder or holders) to cause such indebtedness to be demanded
or otherwise become due
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or to be repurchased, prepaid, defeased, or redeemed (automatically or
otherwise), or an offer to repurchase, prepay, defease, or redeem such
indebtedness to be made, prior to its stated maturity; provided, however, that
any alleged failure to pay or perform as specified in subparagraphs (i) or
(ii) immediately above with respect to indebtedness in a total aggregate
amount not to exceed $10,000,000 shall not constitute an event of default
hereunder; or
(k) any Guarantor shall reject or disaffirm its Guaranty (other than as
a result of a liquidation or dissolution permitted under Sections 8.3 or
Section 8.16 or a merger or consolidation permitted under Section 8.10 or the
termination of a Guaranty as contemplated by Section 8.9), or otherwise notify
Administrative Agent that it does not intend the Guaranty or its liability
thereunder to apply to any one or more future Borrowings or other Obligations;
or
(l) any Borrowing Base Certificate proves to have been incorrect in any
material respect when delivered to Administrative Agent; or
(m) except as otherwise permitted under Section 8.15(a) as to the
payment or repurchase of Subordinated Debt, any Subordinated Debt or other
indebtedness which is expressly subordinated to the Obligations and is owing
by Borrower, any Subsidiary or any Guarantor to any other Person, or any
interest or premium thereon, shall be declared to be due and payable, or shall
otherwise be required to be prepaid or repurchased (other than as to a
regularly scheduled principal amortization payment), prior to the stated
maturity thereof, including without limitation any prepayment or repurchase of
any Subordinated Debt or other indebtedness expressly subordinated to the
Obligations held by or owing to any other Person which becomes due and
payable, or is otherwise required by such Person to be paid or repurchased, in
connection with any change in control or asset sale of Borrower or any of its
Subsidiaries; or
(n) there is entered against Borrower or any Subsidiary a final
unsatisfied judgment or order for the payment of money in an aggregate amount
exceeding $10,000,000 (to the extent not covered by insurance as to which the
insurer does not dispute coverage) and (i) enforcement proceedings are
commenced by any creditor upon such judgment or order, or (ii) there is a
period of ten (10) consecutive days during which a stay of enforcement of such
judgment, by reason of a pending appeal or otherwise, is not in effect; or
(o) (i) An ERISA Event occurs with respect to a Plan which has resulted
or could reasonably be expected to result in liability of Borrower under Title
IV of ERISA to the Plan or the PBGC in an aggregate amount in excess of
$10,000,000, or (ii) Borrower or any ERISA Affiliate fails to pay when due,
after the expiration of any applicable grace period, any installment payment
with respect to its withdrawal liability under Section 4201 of ERISA under a
Multiemployer Plan in an aggregate amount in excess of $10,000,000; or
(p) a Change of Control occurs unless Borrower complies with the terms
and conditions set forth in Section 4.18.
9.2 Remedies. If any Event of Default occurs, Administrative Agent
shall, at the request of, or may, with the consent of, the Majority Lenders:
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(a) declare the commitment of each Lender to make Loans and any
obligation of the Issuing Banks to issue Letters of Credit to be terminated,
whereupon such commitments and obligation shall be terminated;
(b) declare the unpaid principal amount of all outstanding Loans, all
interest accrued and unpaid thereon, and its Pro Rata Share of all other
amounts payable under the Loan Documents to be immediately due and payable,
whereupon the same shall be immediately due and payable without presentment,
demand, protest, notice of intention to accelerate, notice of acceleration, or
other notice of any kind, all of which are hereby expressly waived by
Borrower; and
(c) exercise on behalf of itself and Lenders all rights and remedies
available to it and Lenders under the Loan Documents or applicable law;
provided, however, that upon the occurrence of any event specified in
subsection (h) of Section 9.1, (a) the respective obligations of the Issuing
Banks to issue Letters of Credit shall automatically terminate, (b) the
obligation of each Lender to make Loans shall automatically terminate, and (c)
the unpaid principal amount of all outstanding Loans and all interest and
other amounts as aforesaid shall automatically become due and payable without
further act of Administrative Agent or any Lender. Upon the occurrence of any
Event of Default, Borrower shall immediately pay to Administrative Agent, for
the benefit of Lenders, an amount (the "L/C Obligations Amount") equal to the
aggregate outstanding L/C Obligations; and upon receipt of the payment of the
L/C Obligations Amount, Administrative Agent shall deposit such funds in an
interest-bearing cash account (the "Cash Account") in the name of Borrower
maintained with Administrative Agent as to which Borrower shall have no right
of withdrawal except as provided below. Borrower hereby irrevocably authorizes
and directs Administrative Agent to apply amounts on deposit in the Cash
Account against draws on the outstanding Letters of Credit as such draws are
made. Upon expiration of all Letters of Credit and payment in full of all
draws thereunder and all outstanding Loans and other Obligations, the amounts
then on deposit in the Cash Account and any interest accrued thereon shall
then be returned to Borrower (to the extent any funds remain in the Cash
Account after application of such funds as provided above.)
9.3 Rights Not Exclusive. The rights and remedies of Administrative
Agent and Lenders provided for in this Agreement and the other Loan Documents
are cumulative and are not exclusive of any other rights, powers, privileges,
or remedies provided by law or in equity, or under any other instrument,
document or agreement now existing or hereafter arising.
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ARTICLE 10: ADMINISTRATIVE AGENT.
10.1 Appointment and Authorization. Each Lender hereby irrevocably
appoints, designates and authorizes Administrative Agent to take such action
in its behalf under the provisions of this Agreement and each other Loan
Document and to exercise such powers and perform such duties as are expressly
delegated to it by the terms of this Agreement or any other Loan Document,
together with such powers as are reasonably incidental thereto.
Notwithstanding any provision to the contrary contained elsewhere in this
Agreement or in any other Loan Document, Administrative Agent shall not have
any duties or responsibilities, except those expressly set forth herein, nor
shall Administrative Agent have or be deemed to have any fiduciary
relationship with any Lender, and no implied covenants, functions,
responsibilities, duties, obligations or liabilities shall be read into this
Agreement or any other Loan Document or otherwise exist against Administrative
Agent.
10.2 Delegation of Duties. Administrative Agent may execute any of its
duties under this Agreement or any other Loan Document by or through agents,
employees or attorneys-in-fact and shall be entitled to advice of counsel
concerning all matters pertaining to such duties. Administrative Agent shall
not be responsible for the negligence or misconduct of any agent or
attorney-in-fact that it selects with reasonable care.
10.3 Liability of Administrative Agent. None of Agent-Related Persons
shall:
(a) be liable for any action taken or omitted to be taken by any of
them under or in connection with this Agreement or any other Loan Document or
the transactions contemplated hereby (except for its own gross negligence or
willful misconduct); or
(b) be responsible in any manner to any of Lenders for any recital,
statement, representation or warranty made by Borrower or any Subsidiary or
Affiliate of Borrower, or any officer thereof, contained in this Agreement or
in any other Loan Document, or in any certificate, report, statement or other
document referred to or provided for in, or received by Administrative Agent
under or in connection with, this Agreement or any other Loan Document, or for
the value of or title to any collateral, or the validity, effectiveness,
genuineness, enforceability or sufficiency of this Agreement or any other Loan
Document, or for any failure of Borrower or any other party to any Loan
Document to perform its obligations hereunder or thereunder.
No Agent-Related Person shall be under any obligation to any Lender to
ascertain or to inquire as to the observance or performance of any of the
agreements contained in, or conditions of, this Agreement or any other Loan
Document, or to inspect the properties, books, or records of Borrower or any
of Borrower's Subsidiaries or Affiliates.
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10.4 Reliance by Administrative Agent.
(a) Administrative Agent shall be entitled to rely, and shall be
fully protected in relying, upon any writing, resolution, notice, consent,
certificate, affidavit, letter, telegram, facsimile or telephone message,
electronic mail message, statement or other document or conversation believed
by it to be genuine and correct and to have been signed, sent or made by the
proper Person or Persons, and upon advice and statements of legal counsel
(including counsel to Borrower), independent accountants and other experts
selected by Administrative Agent. Administrative Agent shall be fully
justified in failing or refusing to take any action under this Agreement or
any other Loan Document unless it shall first receive such advice or
concurrence of each Lender as it deems appropriate and, if it so requests, it
shall first be indemnified to its satisfaction by Lenders against any and all
liability and expense which may be incurred by it by reason of taking or
continuing to take any such action. Administrative Agent shall in all cases
be fully protected in acting, or in refraining from acting, under this
Agreement or any other Loan Document in accordance with a request or consent
of the Majority Lenders (or such greater number of Lenders as may be
expressly required hereby in any instance), and such request and any action
taken or failure to act pursuant thereto shall be binding upon all of
Lenders.
(b) For purposes of determining compliance with the conditions
specified in Article 6, each Lender that has executed this Agreement and has
authorized any release from escrow that may have been delivered with such
execution shall be deemed to have consented to, approved, or accepted or to
be satisfied with, each document or other matter either sent by
Administrative Agent to such Lender for consent, approval, acceptance, or
satisfaction, or required thereunder to be consented to or approved by or
acceptable or satisfactory to such Lender.
10.5 Notice of Default. Administrative Agent shall not be deemed to
have knowledge or notice of the occurrence of any Default or Event of
Default, except with respect to defaults in the payment of principal,
interest and fees required to be paid to Administrative Agent for the account
of Lenders, unless Administrative Agent shall have received written notice
from a Lender or Borrower referring to this Agreement, describing such
Default or Event of Default and stating that such notice is a "notice of
default." Administrative Agent will notify Lenders of its receipt of any such
notice. Administrative Agent shall take such action with respect to such
default or Event of Default as may be requested by the Majority Lenders in
accordance with Article 9; provided, however, that unless and until
Administrative Agent has received any such request, Administrative Agent may
(but shall not be obligated to) take such action, or refrain from taking such
action, with respect to such default or Event of Default as it shall deem
advisable or in the best interest of Lenders.
10.6 Credit Decision. Each Lender acknowledges that none of
Agent-Related Persons has made any representation or warranty to it, and that
no act by Administrative Agent hereinafter taken, including any review of the
affairs of Borrower and its Subsidiaries, shall be deemed to constitute any
representation or warranty by any Agent-Related Person to any Lender. Each
Lender represents to Administrative Agent that it has, independently and
without reliance upon any Agent-Related Person and based on such documents
and information as it has deemed appropriate, made its own appraisal of and
investigation into the business, prospects, operations, property, financial
and other condition and creditworthiness of Borrower and its Subsidiaries,
the value of and title to any collateral, and all
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applicable bank regulatory laws relating to the transactions contemplated
hereby, and made its own decision to enter into this Agreement and to extend
credit to Borrower hereunder. Each Lender also represents that it will,
independently and without reliance upon any Agent-Related Person and based on
such documents and information as it shall deem appropriate at the time,
continue to make its own credit analysis, appraisals and decisions in taking
or not taking action under this Agreement and the other Loan Documents, and
to make such investigations as it deems necessary to inform itself as to the
business, prospects, operations, property, financial and other condition and
creditworthiness of Borrower. Except for notices, reports, and other
documents expressly herein required to be furnished to Lenders by
Administrative Agent, Administrative Agent shall not have any duty or
responsibility to provide any Lender with any credit or other information
concerning the business, prospects, operations, property, financial and other
condition or creditworthiness of Borrower which may come into the possession
of any of Agent-Related Persons.
10.7 Indemnification. Whether or not the transactions contemplated
hereby are consummated, Lenders shall indemnify upon demand Agent-Related
Persons (to the extent not reimbursed by or on behalf of Borrower and without
limiting the obligations of Borrower to do so), pro rata, from and against
any and all liabilities covered by any indemnification hereunder; provided,
however, that no Lender shall be liable for the payment to Agent-Related
Persons of any portion of such liabilities resulting solely from such
Person's gross negligence or willful misconduct. Without limitation of the
foregoing, each Lender shall reimburse Administrative Agent upon demand for
its ratable share of any costs or out-of-pocket expenses (including Attorney
Costs) incurred by Administrative Agent in connection with the preparation,
execution, delivery, administration, modification, amendment or enforcement
(whether through negotiations, legal proceedings or otherwise) of, or legal
advice in respect of rights or responsibilities under, this Agreement, any
other Loan Document, or any document contemplated by or referred to herein,
to the extent that Administrative Agent is not reimbursed for such expenses
by or on behalf of Borrower. The undertaking in this Section 10.7 shall
survive the payment of all Obligations hereunder and the resignation or
replacement of Administrative Agent.
10.8 Administrative Agent in Individual Capacity. Bank of America and
its Affiliates may make loans to, issue letters of credit for the account of,
accept deposits from, acquire equity interests in, and generally engage in
any kind of banking, trust, financial advisory, underwriting, or other
business with Borrower and its Subsidiaries and Affiliates as though Bank of
America were not Administrative Agent hereunder and without notice to or
consent of Lenders. Each Lender acknowledges that, pursuant to such
activities, Bank of America or its Affiliates may receive information
regarding Borrower or its Affiliates (including information that may be
subject to confidentiality obligations in favor of Borrower or such
Subsidiary) and acknowledge that Administrative Agent shall be under no
obligation to provide such information to it. With respect to its Loans, Bank
of America shall have the same rights and powers under this Agreement as any
other bank and may exercise the same as though it were not Administrative
Agent, and the terms "Lender" and "Lenders" include Bank of America in its
individual capacity.
10.9 Successor Administrative Agent. Administrative Agent may (and if
it fails to hold the Commitments or Notes required in Section 11.6(b), shall)
resign as Administrative Agent upon thirty (30) days' notice to Lenders. If
Administrative Agent resigns under this Agreement, the Majority Lenders shall
appoint from among Lenders a successor agent for Lenders upon the written
consent of
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Borrower if no Event of Default is outstanding (which consent shall not be
unreasonably withheld). If no successor agent is appointed prior to the
effective date of the resignation of Administrative Agent, Administrative
Agent may appoint a successor agent from among Lenders upon the written
consent of Borrower if no Event of Default is outstanding (which consent
shall not be unreasonably withheld). Upon the acceptance of its appointment
as successor agent hereunder, such successor agent shall succeed to all the
rights, powers, and duties of the retiring Administrative Agent and the term
"Administrative Agent" shall mean such successor agent and the retiring
Administrative Agent's appointment, powers and duties as Administrative Agent
shall be terminated. After any retiring Administrative Agent's resignation
hereunder as Administrative Agent, the provisions of this Article 10 shall
inure to its benefit as to any actions taken or omitted to be taken by it
while it was Administrative Agent under this Agreement. If no successor agent
has accepted appointment as Administrative Agent by the date which is thirty
(30) days following a retiring Administrative Agent's notice of resignation,
the retiring Administrative Agent's resignation shall nevertheless thereupon
become effective and Lenders shall perform all of the duties of
Administrative Agent hereunder until such time, if any, as the Majority
Lenders appoint a successor agent as provided for above.
10.10 Tax Forms.
(a) (i) Each Lender that is not a "United States person" within the
meaning of Section 7701(a)(30) of the Code (a "Foreign Lender") shall deliver
to Borrower and Administrative Agent, prior to the date of its execution and
delivery of this Agreement in the case of each Lender listed on the signature
pages hereof and on or prior to the date on which it becomes a Lender in the
case of each other Lender, two (2) duly signed completed copies of either IRS
Form W-8BEN or any successor thereto (relating to such Foreign Lender and
entitling it to an exemption from, or reduction of, withholding tax on all
payments to be made to such Foreign Lender by Borrower pursuant to this
Agreement or the other Loan Documents) or IRS Form W-8ECI or any successor
thereto (relating to all payments to be made to such Foreign Lender by
Borrower pursuant to this Agreement or the other Loan Documents and
certifying that such Lender is entitled to a complete exemption from
withholding taxes on all such payments) or such other evidence satisfactory
to Borrower and Administrative Agent that such Foreign Lender is entitled to
a complete exemption from U.S. withholding tax, including any exemption
pursuant to Section 881(c) of the Code. Thereafter and from time to time,
each such Foreign Lender shall (A) promptly submit to Administrative Agent
such additional duly completed and signed copies of one of such forms (or
such successor forms as shall be adopted from time to time by the relevant
United States taxing authorities) as may then be available under then current
United States laws and regulations to avoid, or such evidence as is
satisfactory to Borrower and Administrative Agent of any available exemption
from or reduction of, United States withholding taxes in respect of all
payments to be made to such Foreign Lender by the Borrower pursuant to this
Agreement and the other Loan Documents, (B) promptly notify Administrative
Agent of any change in circumstances which would modify or render invalid any
claimed exemption or reduction, and (C) take such steps as shall not be
materially disadvantageous to it, in the reasonable judgment of such Lender,
and as may be reasonably necessary (including the re-designation of its
Lending Office) to avoid or mitigate any requirement of applicable Laws that
Borrower make any deduction or withholding for taxes from amounts payable to
such Foreign Lender.
(ii) Each Foreign Lender, to the extent it does not act or ceases
to act for its own account with respect to any portion of any sums paid
or payable to such Lender under any of
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the Loan Documents (for example, in the case of a typical participation
by such Lender), shall deliver to Administrative Agent on the date when
such Foreign Lender ceases to act for its own account with respect to
any portion of any such sums paid or payable, and at such other times
as may be necessary in the determination of Administrative Agent (in
the reasonable exercise of its discretion), (A) two (2) duly signed
completed copies of the forms or statements required to be provided by
such Lender as set forth above, to establish the portion of any such
sums paid or payable with respect to which such Lender acts for its own
account that is not subject to U.S. withholding tax, and (B) two (2)
duly signed completed copies of IRS Form W-8IMY (or any successor
thereto), together with any information such Lender chooses to transmit
with such form, and any other certificate or statement of exemption
required under the Code, to establish that such Lender is not acting
for its own account with respect to a portion of any such sums payable
to such Lender.
(iii) Borrower shall not be required to pay any additional amount
to any Foreign Lender under Section 4.5 (A) with respect to any Taxes
required to be deducted or withheld on the basis of the information,
certificates or statements of exemption such Lender transmits with an
IRS Form W-8IMY pursuant to this Section 10.10(a) or (B) if such Lender
shall have failed to satisfy the foregoing provisions of this Section
10.10(a); provided that if such Lender shall have satisfied the
requirement of this Section 10.10(a) on the date such Lender became a
Lender or ceased to act for its own account with respect to any payment
under any of the Loan Documents (and if such Lender thereafter provides
forms, certificates, and evidence establishing an exemption or
reduction of withholding tax to the extent such Lender remains legally
able to do so), nothing in this Section 10.10(a) shall relieve Borrower
of its obligation to pay any amounts pursuant to Section 4.5 in the
event that, as a result of any change in any applicable law, treaty or
governmental rule, regulation or order, or any change in the
interpretation, administration, or application thereof, such Lender is
no longer properly entitled to deliver forms, certificates or other
evidence at a subsequent date establishing the fact that such Lender or
other Person for the account of which such Lender receives any sums
payable under any of the Loan Documents is not subject to withholding
or is subject to withholding at a reduced rate.
(iv) Administrative Agent may, without reduction, withhold any
Taxes required to be deducted and withheld from any payment under any
of the Loan Documents with respect to which the Borrower is not
required to pay additional amounts under this Section 10.10(a).
(b) Upon the request of Administrative Agent, each Lender that is a
"United States person" within the meaning of Section 7701(a)(30) of the Code
shall deliver to Administrative Agent two (2) duly signed completed copies of
IRS Form W-9. If such Lender fails to deliver such forms, then Administrative
Agent may withhold from any interest payment to such Lender an amount
equivalent to the applicable back-up withholding tax imposed by the Code,
without reduction. Borrower shall not be required to pay any additional
amount to any Lender under Section 4.5 with respect to any withholding under
this Section 10.10(b).
(c) If any Governmental Authority asserts that Administrative Agent
did not properly withhold or backup withhold, as the case may be, any tax or
other amount from payments made to or for the account of any Lender, such
Lender shall indemnify Administrative Agent therefor, including
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all penalties and interest, any taxes imposed by any jurisdiction on the
amounts payable to the Administrative Agent under this Section 10.10, and
costs and expenses (including Attorney Costs) of the Administrative Agent.
The obligation of Lenders under this Section 10.10 shall survive the
termination of the Total Aggregate Commitment, repayment of all other
Obligations hereunder, and the resignation of Administrative Agent.
10.11 Defaulting Lenders. If for any reason any Lender wrongfully (in
violation of this Agreement) fails or refuses to advance its Pro Rata Share
of any Loan or Loans, or otherwise defaults on any of its material
obligations under this Agreement, and fails to cure its default within five
(5) Business Days of receiving written notice from Administrative Agent of
its failure to perform (such Lender being a "Defaulting Lender"), then in
addition to the rights and remedies that may be available to Administrative
Agent and Lenders at law or in equity, the Defaulting Lender's right to
participate in this Agreement will be suspended during the pendency of such
Defaulting Lender's uncured default, and (without limiting the foregoing)
Administrative Agent may (or at the direction of the Majority Lenders, shall)
withhold from such Defaulting Lender any interest payments, fees, principal
payments, or other sums otherwise payable to such Defaulting Lender under the
Loan Documents until such default of such Defaulting Lender has been cured.
Each non-defaulting Lender will have the right, but not the obligation, in
its sole discretion, to acquire at par a proportionate share (based on the
ratio of its Commitment to the aggregate amount of the Commitments of all of
the non-defaulting Lenders that elect to acquire a share of the Defaulting
Lender's Commitment) of the Defaulting Lender's Commitment, including without
limitation its proportionate share in the outstanding principal balance of
the Loans. The Defaulting Lender will pay and protect, defend, and indemnify
Administrative Agent and each of the other Lenders against, and hold
Administrative Agent, and each of the other Lenders harmless from, all
claims, actions, proceedings, liabilities, damages, losses, and expenses
(including without limitation Attorney Costs, and interest at the Reference
Rate plus two percent (2%) per annum for the funds advanced by Administrative
Agent or any Lenders on account of the Defaulting Lender) they may sustain or
incur by reason of or in consequence of the Defaulting Lender's failure or
refusal to perform its obligations under the Loan Documents. Administrative
Agent may set off against payments due to the Defaulting Lender for the
claims of Administrative Agent and the other Lenders against the Defaulting
Lender. The exercise of these remedies will not reduce, diminish or liquidate
the Defaulting Lender's Commitment (except to the extent that part or all of
such Commitment is acquired by the other Lenders as specified above) or its
obligations to share losses and reimbursement for costs, liabilities and
expenses under this Agreement. This indemnification will survive the payment
and satisfaction of all of Borrower's obligations and liabilities to Lenders.
The foregoing provisions of this Section 10.11 are solely for the benefit of
Administrative Agent and Lenders, and may not be enforced or relied upon by
Borrower.
10.12 Actions. Administrative Agent shall have the right to commence,
appear in, and defend any action or proceeding purporting to affect the
rights or duties of Lenders hereunder or the payment of any funds, and in
connection therewith Administrative Agent may pay necessary expenses, employ
counsel, and pay Attorney Costs. Borrower agrees to pay to Administrative
Agent, within five (5) Business Days after demand, all reasonable costs and
expenses incurred by Administrative Agent in connection therewith, including
without limitation reasonable Attorney Costs, together with interest thereon
from the date which is five (5) Business Days after demand until paid at a
rate per annum equal to the Reference Rate plus the Applicable Margin, if
any, applicable to Reference Rate Borrowings plus two percent (2%).
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10.13 Syndication Agent, Documentation Agent and Co-Agent. No Lender
or other Persons identified on the facing page or signature pages of this
Agreement as a "syndication agent," "documentation agent," "co-agent," "book
manager," "lead manager," "arranger," "lead arranger," or "co-arranger" shall
have any right, power, obligation, liability, responsibility, or duty under
this Agreement other than, in the case of such Lenders, those applicable to
all Lenders as such. Without limiting the foregoing, no Lender or other
Person so identified shall have or be deemed to have any fiduciary
relationship with any Lender. Each Lender acknowledges that it has not
relied, and will not rely, on any other Lender or other Person so identified
in deciding to enter into this Agreement or in taking or not taking action
hereunder.
10.14 Approval of Lenders.
(a) All communications from Administrative Agent to Lenders
requesting Lenders' determination, consent, approval, or disapproval (i)
shall be given in the form of a written notice to each Lender, (ii) shall be
accompanied by a description of the matter or thing as to which such
determination, approval, consent, or disapproval is requested, or shall
advise each Lender where such matter or thing may be inspected, or shall
otherwise describe the matter or issue to be resolved, (iii) shall include,
if reasonably requested by a Lender and to the extent not previously provided
to such Lender, written materials and a summary of all oral information
provided to Administrative Agent by Borrower in respect of the matter or
issue to be resolved, and (iv) shall include Administrative Agent's
recommended course of action or determination in respect thereof. Each Lender
shall reply promptly, but in any event within fifteen (15) Business Days (or
such lesser period as may be required under the Loan Documents for
Administrative Agent to respond) after receipt of the request therefore by
Administrative Agent (in either event, the "Lender Reply Period").
(b) Unless a Lender shall give written notice to Administrative
Agent that it objects to the recommendation or determination of
Administrative Agent (together with a written explanation of the reasons
behind such objection) contained in a request described in clause (a) above
that is marked "REQUEST FOR APPROVAL" within the Lender Reply Period, such
Lender shall be deemed to have approved of or consented to such
recommendation or determination.
ARTICLE 11: MISCELLANEOUS.
11.1 Amendments and Waivers. No amendment or waiver of any provision
of this Agreement or any other Loan Document, and no consent with respect to
any departure by Borrower or any Subsidiary therefrom, shall be effective
unless the same shall be in writing and signed by the Majority Lenders (or by
Administrative Agent at the written request of the Majority Lenders) and
Borrower and acknowledged by Administrative Agent, and then any such waiver
of consent shall be effective only in the specific instance and for the
specific purpose for which given; provided, however, that no such waiver,
amendment, or consent shall do any of the following:
(a) increase or extend the Commitment of any Lender without the
written consent of such Lender;
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(b) postpone or delay any date fixed by this Agreement or any other
Loan Document for any payment of principal, interest, fees or other amounts
due to Lenders (or any of them) hereunder or under any other Loan Document
without the written consent of each Lender affected thereby;
(c) reduce the principal of, or the rate of interest specified
herein on any Loan, or any fees or other amounts payable hereunder or under
any other Loan Document without the written consent of each Lender affected
thereby;
(d) change the percentage of the Commitments or of the aggregate
unpaid principal amount of the Loans which is required for Lenders or any of
them to take any action hereunder without the written consent of all Lenders;
(e) amend the definition of Majority Lenders without the written
consent of all Lenders;
(f) amend this Section 11.1 or any provision herein providing for
consent or other action by all Lenders without the written consent of all
Lenders;
(g) discharge any Guarantor without the written consent of all
Lenders (except as provided in Section 8.9 and where the consent of the
Majority Lenders only is specifically provided for); or
(h) amend, or perform any act pursuant to, any provision herein
expressly requiring the consent of each Lender without the written consent of
each Lender;
and, provided further, that (i) no amendment, waiver, or consent shall,
unless in writing and signed by the applicable Issuing Bank, in addition to
the Lenders required above, affect the rights or duties of any Issuing Bank
under this Agreement or any Loan Document relating to any Letter of Credit
issued or to be issued by it, (ii) no amendment, waiver, or consent shall,
unless in writing and signed by Swing Line Lender in addition to the Lenders
required above, affect the rights or duties of Swing Line Lender, as the
maker of Swing Line Advances under this Agreement, (iii) no amendment,
waiver, or consent shall, unless in writing and signed by Administrative
Agent in addition to the Lenders required above, affect the rights or duties
of Administrative Agent under this Agreement or any other Loan Document, and
(iv) the Fee Letter may be amended, or rights or privileges thereunder
waived, in a writing executed only by the parties thereto. Notwithstanding
anything to the contrary herein, no Defaulting Lender shall have any right to
approve or disapprove any amendment, waiver, or consent hereunder, except
that the Commitment of such Lender may not be increased or extended without
the consent of such Lender.
11.2 Costs, Expenses, and Taxes. Borrower agrees (a) to pay or
reimburse Administrative Agent for all reasonable costs and expenses incurred
in connection with the development, preparation, negotiation, and execution
of this Agreement and the other Loan Documents and any amendment, waiver,
consent, or other modification of the provisions hereof and thereof (whether
or not the transactions contemplated hereby or thereby are consummated), and
the consummation and administration of the transactions contemplated hereby
and thereby, including all Attorney Costs, and (b) to pay or reimburse
Administrative Agent, each Issuing Bank, and each Lender for all costs and
expenses incurred in connection with the enforcement, attempted enforcement,
or preservation of any
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rights or remedies under this Agreement or the other Loan Documents
(including all such costs and expenses incurred during any "workout" or
restructuring in respect of the Obligations and during any legal proceeding,
including any proceeding under any Debtor Relief Law), including all Attorney
Costs. The foregoing costs and expenses shall include all search, filing,
recording, title insurance, and appraisal charges and fees and taxes related
thereto, and other out-of-pocket expenses incurred by Administrative Agent.
All amounts due under this Section 11.2 shall be payable within ten (10)
Business Days after demand therefor. Any amount payable to Administrative
Agent, any Issuing Bank, and Lenders under this Section 11.2 shall, from the
date of demand for payment, and any other amount payable to Administrative
Agent under the Loan Documents which is not paid when due or within any
applicable grace period shall, thereafter, bear interest at the rate in
effect under each Note with respect to Reference Rate Borrowings. The
agreements in this Section 11.2 shall survive the termination of the Total
Aggregate Commitment and repayment of all other Obligations.
11.3 No Waiver; Cumulative Remedies. No failure to exercise and no
delay in exercising, on the part of Administrative Agent or any Lender, any
right, remedy, power, or privilege hereunder, shall operate as a waiver
thereof; nor shall any single or partial exercise of any right, remedy,
power, or privilege hereunder preclude any other or further exercise thereof
or the exercise of any other right, remedy, power or privilege.
11.4 Payments Set Aside. To the extent that Borrower makes a payment
to Administrative Agent or Lenders, or Administrative Agent or Lenders
exercise their right of set-off, and such payment or the proceeds of such
set-off or any part thereof are subsequently invalidated, declared to be
fraudulent or preferential, set aside or required (including pursuant to any
settlement entered into by Administrative Agent or such Lender in its
discretion) to be repaid to a trustee, receiver, or any other party, in
connection with any Debtor Relief Laws, then (a) to the extent of such
recovery the obligation or part thereof originally intended to be satisfied
shall be revived and continued in full force and effect as if such payment
had not been made or such set-off had not occurred, and (b) each Lender
severally agrees to pay to Administrative Agent upon demand its Pro Rata
Share of any amount so recovered from or repaid by Administrative Agent.
11.5 Successors and Assigns. The provisions of this Agreement shall
be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns, except that Borrower may not assign or
transfer any of its rights or obligations under this Agreement without the
prior written consent of Administrative Agent and each Lender, and no Lender
may assign or transfer any of its rights or obligations under this Agreement
except in accordance with Section 11.6.
11.6 Assignments, Participations, etc.
(a) No Lender may assign or otherwise transfer any of its rights or
obligations hereunder except (i) to an Eligible Assignee in accordance with
the provisions of Section 11.6(b), (ii) by way of participation in accordance
with the provisions of Section 11.6(d), or (iii) by way of pledge or
assignment of a security interest subject to the restrictions of Section
11.6(f) (and any other attempted assignment or transfer by any party hereto
shall be null and void). Nothing in this Agreement, expressed or implied,
shall be construed to confer upon any Person (other than the parties hereto,
their respective successors and assigns permitted hereby, Participants to the
extent provided in
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Section 11.6(d), and, to the extent expressly contemplated hereby, the
Indemnified Parties) any legal or equitable right, remedy, or claim under or
by reason of this Agreement.
(b) Any Lender may at any time assign to one (1) or more Eligible
Assignees all or a portion of its rights and obligations under this Agreement
(including all or a portion of its Commitment and Borrowings (including for
purposes of this Section 11.6(b), participations in L/C Obligations) at the
time owing to it); provided that: (i) except in the case of an assignment of
the entire remaining amount of the assigning Lender's Commitment and
Borrowings at the time owing to it or in the case of an assignment to a
Lender or an Affiliate of a Lender with respect to a Lender, the aggregate
amount of the Commitment (which for this purpose includes Borrowings
outstanding thereunder) subject to each such assignment, determined as of the
date the Assignment and Assumption with respect to such assignment is
delivered to Administrative Agent or, if "Trade Date" is specified in the
Assignment and Assumption, as of the Trade Date, shall not be less than
$1,000,000 unless each of Administrative Agent and, so long as no Event of
Default has occurred and is continuing, Borrower otherwise consents (each
such consent not to be unreasonably withheld or delayed); (ii) each partial
assignment shall be made as an assignment of a proportionate part of all the
assigning Lender's rights and obligations under this Agreement with respect
to the Commitment and Borrowings assigned, except that this clause (ii) shall
not apply to rights in respect of Swing Line Advances; (iii) any assignment
of a Commitment must be approved by Administrative Agent and each Issuing
Bank unless the Person that is the proposed assignee is itself a Lender
(whether or not the proposed assignee would otherwise qualify as an Eligible
Assignee) each such consent not be to unreasonably withheld or delayed; (iv)
after giving effect to such assignment, unless the assigning Lender is
assigning all of its rights and Commitments hereunder, the assigning Lender
shall retain a Commitment of at least $10,000,000 (or such lesser amount
agreed to by Borrower and Administrative Agent), or if the Total Aggregate
Commitment has been terminated, their Notes having outstanding principal
balance of at least $10,000,000 (or such lesser amount agreed to by Borrower
and Administrative Agent), except for each Lender which acts as
Administrative Agent, Syndication Agent, and Documentation Agent,
respectively, which each must retain a Commitment of not less than
$15,000,000, or if the Total Aggregate Commitment has been terminated, their
Notes having outstanding principal balance of at least $15,000,000, except if
such Lenders resign as Administrative Agent, Syndication Agent, or
Documentation Agent, as applicable; and (v) the parties to each assignment
shall execute and deliver to Administrative Agent an Assignment and
Assumption, together with a processing and recordation fee of $3,500. Subject
to acceptance and recording thereof by Administrative Agent pursuant to
Section 11.6(c), from and after the effective date specified in each
Assignment and Assumption, the Eligible Assignee thereunder shall be a party
to this Agreement and, to the extent of the interest assigned by such
Assignment and Assumption, have the rights and obligations of a Lender under
this Agreement, and the assigning Lender thereunder shall, to the extent of
the interest assigned by such Assignment and Assumption, be released from its
obligations under this Agreement (and, in the case of an Assignment and
Assumption covering all of the assigning Lender's rights and obligations
under this Agreement, such Lender shall cease to be a party hereto but shall
continue to be entitled to the benefits of Sections 4.5, 4.7, 4.8, 11.2, and
11.12 with respect to facts and circumstances occurring prior to the
effective date of such assignment). Upon request, Borrower (at its expense)
shall execute and deliver Note(s) to the assignee Lender. Any assignment or
transfer by a Lender of rights or obligations under this Agreement that does
not comply with this Section 11.6(b) shall be treated for purposes of this
Agreement as a sale by such Lender of a participation in such rights and
obligations in accordance with Section 11.6(d).
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(c) Administrative Agent, acting solely for this purpose as an agent
of Borrower, shall maintain at Administrative Agent's Lending Office a copy
of each Assignment and Assumption delivered to it and a register for the
recordation of the names and addresses of Lenders, and the Commitments of,
and principal amounts of the Borrowings owing to, each Lender pursuant to the
terms hereof from time to time (the "Register"). The entries in the Register
shall be conclusive, and Borrower may treat each Person whose name is
recorded in the Register pursuant to the terms hereof as a Lender hereunder
for all purposes of this Agreement, notwithstanding notice to the contrary.
The Register shall be available for inspection by Borrower and any Lender, at
any reasonable time and from time to time upon reasonable prior notice.
(d) Any Lender may at any time sell participations to any Eligible
Assignee (each, a "Participant") in all or a portion of such Lender's rights
and/or obligations under this Agreement (including all or a portion of its
Commitment and/or the Borrowings (including such Lender's participations in
Swing Line Advances) owing to it); provided that (i) such Lender's
obligations under this Agreement shall remain unchanged, (ii) such Lender
shall remain solely responsible to the other parties hereto for the
performance of such obligations, and (iii) Borrower shall continue to deal
solely and directly with such Lender in connection with such Lender's rights
and obligations under this Agreement. Any agreement or instrument pursuant to
which a Lender sells such a participation shall provide that such Lender
shall retain the sole right to enforce this Agreement and to approve any
amendment, modification, or waiver of any provision of this Agreement;
provided that such agreement or instrument may provide that such Lender will
not, without the consent of the Participant, agree to any amendment, waiver,
or other modification described in the first proviso to Section 11.1 that
directly affects such Participant. Subject to Section 11.6(e), Borrower
agrees that each Participant shall be entitled to the benefits of Sections
4.5, 4.7, and 4.8 to the same extent as if it were a Lender and had acquired
its interest by assignment pursuant to Section 11.6(b). To the extent
permitted by law, each Participant also shall be entitled to the benefits of
Section 3.8 as though it were a Lender.
(e) A Participant shall not be entitled to receive any greater
payment under Sections 4.5 or 4.7 than the applicable Lender would have been
entitled to receive with respect to the participation sold to such
Participant, unless the sale of the participation to such Participant is made
with Borrower's prior written consent. A Participant that would be a foreign
Lender if it were a Lender shall not be entitled to the benefits of Section
4.5 unless Borrower is notified of the participation sold to such Participant
and such Participant agrees, for the benefit of Borrower, to comply with
Section 10.10 as though it were a Lender.
(f) Any Lender may at any time pledge or assign a security interest
in all or any portion of its rights under this Agreement (including under its
Notes, if any) to secure obligations of such Lender, including any pledge or
assignment to secure obligations to a Federal Reserve Bank; provided that no
such pledge or assignment shall release such Lender from any of its
obligations hereunder or substitute any such pledgee or assignee for such
Lender as a party hereto.
(g) Notwithstanding anything to the contrary contained herein, if at
any time Bank of America assigns all of its Commitment and Borrowings
pursuant to Section 11.6(b), Bank of America shall resign as Swing Line
Lender and as an Issuing Bank. In such event, Borrower shall be entitled to
appoint from among Lenders a successor Lender to be Swing Line Lender or to
act as an Issuing Bank
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so long as such successor Lender is willing to act in such capacities;
provided, however, that no failure by Borrower to appoint any such successor
shall affect the resignation of Bank of America; and provided, further, that
Bank of America shall retain all the rights provided for hereunder with
respect to outstanding Swing Line Advances made by it and issued and
outstanding Letters of Credit issued by it, as of the effective date of such
resignation, including the right to require Lenders to fund their Pro Rata
Share outstanding Swing Line Advances and L/C Obligations.
11.7 Set-off. In addition to any rights and remedies of Lenders
provided by Law, if an Event of Default exists or the Loans have been
accelerated, each Lender is authorized at any time and from time to time,
without prior notice to Borrower, any such notice being waived by Borrower to
the fullest extent permitted by law, to set off and apply any and all
deposits (general or special, time or demand, provisional or final excluding
Borrower's customer or regulatory trust accounts) at any time held by, and
other indebtedness at any time owing by, such Lender to or for the credit or
the account of Borrower against any and all Obligations owing to Lenders, now
or hereafter existing, irrespective of whether or not Administrative Agent or
such Lender shall have made demand under this Agreement or any Loan Document
and although such Obligations may be contingent or unmatured. Each Lender
agrees promptly to notify Borrower and Administrative Agent after any such
set-off and application made by such Lender; provided, however, that the
failure to give such notice shall not affect the validity of such set-off and
application.
11.8 Automatic Debits. With respect to any principal or interest
payment, commitment fee or usage fee due and payable to Administrative Agent
or Lenders under the Loan Documents, Borrower hereby irrevocably authorizes
Administrative Agent to debit any deposit account of Borrower with Bank of
America and hereby agrees to irrevocably direct in writing the holder of any
deposit account to debit any deposit account of Borrower (excluding
Borrower's customer or regulatory trust accounts), in amounts specified by
Administrative Agent from time to time such that the aggregate amount debited
from all such deposit accounts does not exceed such payment, fee, other cost
or expense. Administrative Agent shall use its best efforts to give Borrower
advance notice of each debit, but failure of Administrative Agent to give
such notice shall not invalidate its authorization hereunder. If there are
insufficient funds in such deposit accounts to cover the amount of the
payment, fee, other cost or expense then due, such debits will be reversed
(in whole or in part, in Administrative Agent's sole discretion) and such
amount not debited shall be deemed to be unpaid. No such debit under this
Section 11.8 shall be deemed a set-off.
11.9 Notification of Addresses, Lending Offices, Etc. Each Lender
shall notify Administrative Agent in writing of any changes in the address to
which notices to such Lender should be directed, of addresses of any Lending
Office, of payment instructions in respect of all payments to be made to it
hereunder and of such other administrative information as Administrative
Agent shall reasonably request.
11.10 Survival of Representations and Warranties. All representations
and warranties of Borrower contained herein or in any certificate or other
writing delivered by or on behalf of Borrower pursuant to any Loan Document
will survive the making and repayment of the Loan and the execution and
delivery of each Note, and have been or will be relied upon by each Lender,
notwithstanding any investigation made by such Lender or on its behalf.
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11.11 Notices. Except as otherwise provided herein or in each Note:
(a) all notices, requests, demands, directions, and other
communications provided for hereunder and under each Note must be in writing
and must be mailed, telecopied, delivered, or sent by cable to the
appropriate party at the address set forth on the signature pages of this
Agreement or, as to any party, at any other address as may be designated by
it in a written notice sent to the other party in accordance with this
Section 11.11, and
(b) if any notice, request, demand, direction, or other
communication is given by mail it will be effective on the earlier of receipt
or the third calendar day after deposit in the United States mails with first
class or airmail postage prepaid; if given by telecopier, when receipt is
confirmed by the recipient; if given by cable, when delivered to the
telegraph company with charges prepaid; or if given by personal delivery,
when delivered.
11.12 Indemnity by Borrower. Whether or not the transactions
contemplated hereby are consummated, Borrower shall indemnify and hold
harmless each Agent-Related Person, each Issuing Bank, each Lender and their
respective Affiliates, directors, officers, employees, counsel, agents, and
attorneys-in-fact (collectively the "Indemnitees") from and against any and
all liabilities, obligations, losses, damages, penalties, claims, demands,
actions, judgments, suits, costs, expenses, and disbursements (including
Attorney Costs) of any kind or nature whatsoever which may at any time be
imposed on, incurred by or asserted against any such Indemnitee in any way
relating to or arising out of or in connection with (a) the execution,
delivery, enforcement, performance, or administration of any Loan Document or
any other agreement, letter, or instrument delivered in connection with the
transactions contemplated thereby or the consummation of the transactions
contemplated thereby, (b) any Commitment, Loan, or Letter of Credit or the
use or proposed use of the proceeds therefrom (including any refusal by any
Issuing Bank to honor a demand for payment under a Letter of Credit if the
documents presented in connection with such demand do not strictly comply
with the terms of such Letter of Credit), or (c) any actual or prospective
claim, litigation, investigation, or proceeding relating to any of the
foregoing, whether based on contract, tort, or any other theory (including
any investigation of, preparation for, or defense of any pending or
threatened claim, investigation, litigation, or proceeding) and regardless of
whether any Indemnitee is a party thereto (all the foregoing, collectively,
the "Indemnified Liabilities"), IN ALL CASES, WHETHER OR NOT CAUSED BY OR
ARISING, IN WHOLE OR IN PART, OUT OF THE NEGLIGENCE OF THE INDEMNITEE;
provided that such indemnity shall not, as to any Indemnitee, be available to
the extent that such liabilities, obligations, losses, damages, penalties,
claims, demands, actions, judgments, suits, costs, expenses, or disbursements
have (x) resulted from the gross negligence or willful misconduct of such
Indemnitee, or (y) arose out of the dispute among any one or more Lenders
that does not involve Borrower or any Subsidiary as a party to such dispute.
No Indemnitee shall be liable for any damages arising from the use by Persons
other than its Affiliates, directors, officers, employees, counsel, agents,
and attorneys-in-fact of any information or other materials obtained through
IntraLinks or other similar information transmission systems in connection
with this Agreement, nor shall any Indemnitee have any liability for any
indirect or consequential damages relating to this Agreement or any other
Loan Document or arising out of its activities in connection herewith or
therewith (whether before or after the Closing Date). All amounts due under
this Section 11.12 shall be payable within ten (10) Business Days after
demand therefor. The agreements in this
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Section 11.12 shall survive the resignation of Administrative Agent, the
replacement of any Lender, the termination of the Total Aggregate Commitment
and the repayment, satisfaction, or discharge of all the other Obligations.
11.13 Integration and Severability. This Agreement and the other Loan
Documents comprise the complete and integrated agreement of the parties on
the subject matter hereof and supersede all prior agreements, written or
oral, on the subject matter hereof. Any provision in any Loan Document that
is held to be inoperative, unenforceable, or invalid in any jurisdiction
shall, as to that jurisdiction, be inoperative, unenforceable or invalid
without affecting the remaining provisions or the operation, enforceability,
or validity of that provision in any other jurisdiction, and to this end the
provisions of the Loan Documents are declared to be severable.
11.14 Counterparts. This Agreement may be executed in any number of
separate counterparts, each of which, when so executed, shall be deemed an
original, and all of said counterparts taken together shall be deemed to
constitute but one and the same instrument. Facsimile transmission of any
signed original document and/or retransmission of any signed facsimile
transmission will be deemed the same as delivery of an original. At the
request of any party, the parties will confirm facsimile transmission by
signing a duplicate original document.
11.15 No Third Parties Benefitted. This Agreement is made and entered
into for the sole protection and legal benefit of Borrower, Lenders,
Administrative Agent and Agent-Related Persons, and their permitted
successors and assigns, and no other Person shall be a direct or indirect
legal beneficiary of, or have any direct or indirect cause of action or claim
in connection with, this Agreement or any of the other Loan Documents.
11.16 Section Headings. Section headings in this Agreement are
included for convenience of reference only and are not part of this Agreement
for any other purpose.
11.17 Time of the Essence. Time is of the essence of the Loan
Documents.
11.18 Governing Law. The Loan Documents shall be governed by, and
construed and enforced in accordance with, the internal laws of the State of
California without regard to the conflict of law provisions thereof.
11.19 Jury Trial. EACH PARTY TO THIS AGREEMENT HEREBY EXPRESSLY WAIVES
ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION, OR CAUSE OF ACTION
ARISING UNDER ANY LOAN DOCUMENT OR IN ANY WAY CONNECTED WITH OR RELATED OR
INCIDENTAL TO THE DEALINGS OF THE PARTIES HERETO OR ANY OF THEM WITH RESPECT
TO ANY LOAN DOCUMENT, OR THE TRANSACTIONS RELATED THERETO, IN EACH CASE
WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHER FOUNDED IN CONTRACT OR
TORT OR OTHERWISE; AND EACH PARTY HEREBY AGREES AND CONSENTS (SUBJECT TO EACH
PARTY'S RIGHTS AND OBLIGATIONS DESCRIBED IN SECTION 11.19 REGARDING REFERENCE
AND ARBITRATION) THAT ANY SUCH CLAIM, DEMAND, ACTION, OR CAUSE OF ACTION
SHALL BE DECIDED BY COURT TRIAL WITHOUT A JURY, AND THAT ANY PARTY TO
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THIS AGREEMENT MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS SECTION
11.20 WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE SIGNATORIES
HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY.
11.20 Entirety. THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS EXECUTED
BY BORROWER , ADMINISTRATIVE AGENT, OR THE LENDERS REPRESENT THE FINAL
AGREEMENT AMONG BORROWER, ADMINISTRATIVE AGENT, AND THE LENDERS AND MAY NOT
BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL
AGREEMENTS BY THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS AMONG THE
PARTIES.
[Remainder of page blank. Signature pages follow.]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the date first above written.
BORROWER:
STANDARD PACIFIC CORP., a Delaware corporation
By: _______________________________________
Name:__________________________________
Title:_________________________________
By: _______________________________________
Name:__________________________________
Title:_________________________________
Address for Notices:
Standard Pacific Corp.
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇. ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
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LENDERS:
BANK OF AMERICA, N.A., a national banking association
By: _____________________________________________
Name:________________________________________
Title:_______________________________________
Address for Notices:
Bank of America, N.A.
Portfolio Management
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇-▇▇▇-▇▇-▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Arveste ▇▇▇▇▇▇▇, Assistant Vice President
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
E-mail: ▇▇▇▇▇▇▇.▇.▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
With a copy to:
Bank of America, N.A.
Agency Management
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇-▇▇▇-▇▇-▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: Mr. ▇▇▇▇▇ ▇▇▇▇▇, Agency Management Officer
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
E-mail: ▇▇▇▇▇.▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
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_________________________
By: ________________________________________
Name:___________________________________
Title:__________________________________
Address for Notices:
____________________
____________________
____________________
Attn: ______________
Telephone: ________
Telecopier: ________
Eurodollar Lending Office:
____________________
____________________
____________________
Attn: ______________
Telephone: ________
Telecopier: ________
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ADMINISTRATIVE AGENT:
BANK OF AMERICA, N.A., a national banking association
By: ____________________________________________
Name:_______________________________________
Title:______________________________________
Address for Notices:
Bank of America, N.A.
Portfolio Management
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇-▇▇▇-▇▇-▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Arveste ▇▇▇▇▇▇▇, Assistant Vice President
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
E-mail: ▇▇▇▇▇▇▇.▇.▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
With a copy to:
Bank of America, N.A.
Agency Management
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇-▇▇▇-▇▇-▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: Mr. ▇▇▇▇▇ ▇▇▇▇▇, Agency Management Officer
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
E-mail: ▇▇▇▇▇.▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
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